STOCK MARKET TRADING, Types of Stock Market Trading, Best Trading Type

STOCK MARKET TRADING, Types of stock trading

Friends, often we get to hear the word trading in the stock market, today we will discuss this regard "What is stock Market trading? Also, we will know what is stock market trading and what are its types?" Today we will talk about the major types of trading in the stock market and know about what is position trading? What is Intraday Trading? What is Swing Trading? And what is Scalper Trading? We will talk about all these in detail.

Intraday Trading, Position Trading, Swing Trading, Scalper Trading

TRADING

“Trading means buying and selling any goods or services with the intention of making a profit”

The Hindi meaning of Trading is Business. When we buy any goods or services with the intention that after some time we will earn profit by selling those goods and services, then this work is called “Trading”. All the business we see happening around us – whether ration or vegetable shop or another shop, all shopkeepers buy goods or services for this purpose so that they can earn profit by selling them.

STOCK MARKET TRADING

We have seen that TRADING means buying and selling goods or services for the purpose of making a profit. Similarly, when we buy any stock or share in the stock market, then our main objective is to earn profit by selling it when the price of that share or stock increases. And in this way more than 99% of the people participating in the stock market, when they buy and sell any shares or stocks, their action is called "Stock Market Trading".

Types of trading in the stock market

The word “TRADING” seems to be hastier and RISK than “INVESTMENT”, and this is also true to a large extent because the person doing the trading is always waiting for the opportunity and as soon as he sees the right opportunity, he sells his deal. earns tax benefits. There are some main types of trading:-

1. INTRA DAY TRADING (Day trading)

Such trades are completed within a day. That is, the act of buying a Share or Stock on the same day and selling it on the same day is called intraday trading, like buying a stock after the Market opens at 9:15 in the morning and you sell it before the market closes at 3.30 pm on the same day. It is often seen that an intra-day trader does 5-6 trades in a day. The time to hold stock in this type of trading is in a few hours.

In intraday trading, selling shares first and buying them later is called short selling.

Note: For this type of trading, broker companies give you a margin of ten to twenty times more than the amount available with you that you earn profit by taking them there for the whole day and by evening on the same day you sell their money to them. return them.

2. SCALPER TRADING

Such trades are completed within a few minutes. That is, if it is sold within a few minutes to buy a share of stock, then it is called scalper trading. For example, buying a stock after the market opens at 9:15 am, and selling it within 1,2, or 5-10 minutes of buying to make a small but quick profit. It is often seen that amount is very high in this type of trading. 

For example, if you invest 10 lakh rupees and take 10000 shares of 100 rupees in it, then if the share increases by 20 paise above 100 rupees, then 10000 X 0.2 i.e. about 2000 rupees becomes a profit. And if a share of Rs 100 becomes Rs 101, then at the rate of Re 1 per share, you can make a profit of up to Rs 10000. People do this kind of trading to earn quick profit with small profit margins.

Note: For this type of trading, broker companies give you a margin of ten to twenty times more than the amount available to you. So that you earn profit by taking them there for the whole day and by the evening of the same day you sell them their money and return them to them.

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3. SWING TRADING

Such trades are completed within a few days, weeks, or months. That is, after share or stock, keep it with you for a few days, weeks, or even a few months and wait for its true value to increase. For example, selling the shares purchased in January 2021 by February or April May, this type of stock buying is called buying on share delivery.

In this type of trade, the trader trades with the expectation of increasing the price of his shares by more than 5 or 10 percent per day. The thing to note is that in this type of trade, the entire money is invested by the trader, in this the company does not give any kind of Margin Money.

4. Position trading (Long Term Trading )

Holding shares for a long period of time is called positional trading. In position trading, traders focus on long-term price movement, in search of the maximum potential profit and negligible loss from major changes in price. This is one of the best ways of trading in which trader invests for the long term and earns manifold returns.

Trading in position trading usually takes place over a period of weeks, months, or years. Since there are many small fluctuations over a period of several years, it does not have much effect on the position trader. This type is also called best investing. 

Position traders are not concerned with small price fluctuations or slippages, so they do not need to monitor their positions on a daily basis like other trading types. When they make investment ideas for the long term, keep in mind that to choose the best company you should know about the company's fundamentals, future strategy, company's competitive advantage, debt, and many more things.

Stock Market Trading FAQs

What is Trading?

Trading means buying and selling any goods or services with the intention of making a profit.

What is stock market trading?

When we buy or sell a stock or share in the stock market, it is called stock market trading. In this also our aim is to make a profit by selling that stock when the price of that stock increases.

What is intraday trading?

Intraday trading trades are completed within a day i.e. the act of buying a share or stock on the same day and selling it on the same day is called intraday trading. In this, you cannot keep the stock with you for more than a day.

What is scalper trading?

In scalper trading, trades are completed within a few minutes, that is, if a stock is bought and sold within a few minutes, then it is called scalper trading. In this trading, you complete the trade in a few minutes. In this trading, you book profit or loss in a few minutes.

What is swing trading?

In swing trading, trades are completed in a few days, weeks or months. Swing trading involves holding the stock or stock for a few days, weeks, or even a few months after it. And wait for its right price to rise and sell the shares at the right time and book profit.

What is Position Trading?

When you hold the purchased shares for a long time, it is called positional trading, as well as holdings. In this, the app holds the stocks for a period of 1 year, 5 years, 10 years, or more. Position trading has maximum potential profit potential and negligible losses due to large changes in price. Position trading is one of the best trading methods.

We hope you like this article very much about stock market trading and its type. Feedback is kindly invited. Thanks for visiting. Happy Investing.

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