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The Indian stock market provides multiple avenues for investors and traders to participate, with two of the most common styles being Intraday and Delivery Trading. For beginners, these terms can be confusing, and choosing between them depends on your financial goals, risk appetite, and trading style. While intraday focuses on buying and selling within the same day, delivery trading allows you to hold stocks for longer durations.
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DIFFERENCE BETWEEN INTRADAY AND DELIVERY TRADING Explained
Introduction The Indian stock market offers multiple avenues for investors and traders to participate, but two of the most common styles are Intraday and Delivery Trading. For beginners, these terms can be confusing, and choosing between them depends on your financial goals, risk appetite, and trading style. While intraday focuses on buying and selling within the same day, delivery trading allows you to hold stocks for longer durations. In this blog, Lares Algotech explains the difference between Intraday and Delivery Trading in simple terms, covering their definitions, advantages, risks, strategies, taxation, and which type suits you best. Whether you’re a short-term trader or a long-term investor, understanding these two approaches will help you make smarter financial decisions.
What is Intraday Trading? Intraday trading means buying and selling stocks within the same trading session. The primary goal is to profit from short-term price movements in the market. For example, if you buy 100 shares of XYZ Ltd at ₹500 in the morning and sell them at ₹510 by afternoon, you make a profit of ₹1,000 (excluding brokerage and taxes). Key points about intraday trading • Stocks must be squared off (sold) on the same day. • Requires constant monitoring of charts, trends, and market news. • Best suited for active traders who can dedicate time to the markets. • Leverage is often used to maximize profits (but also increases risk).
What is Delivery Trading? Delivery trading, on the other hand, refers to buying shares and holding them beyond one day. The shares are transferred to your demat account, and you can hold them for days, months, or even years. For example, if you buy 100 shares of XYZ Ltd at ₹500 today and hold them for six months until the price rises to ₹650, you earn ₹15,000 profit (excluding charges). No compulsion to sell on the same day. Suitable for investors with a long-term outlook. Shares are eligible for dividends, bonuses, and voting rights. Safer compared to intraday because short-term volatility matters less.
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