Free Investment Advice

A successful day trader or share market trading requires couple of disciplines and following requirements -

1) PC with internet - If you need to do it yourself then you need to have a PC or else you can do it in internet café also. A PC with good internet connection speed. The internet connection should not be slow or should not face any other problem especially in Day Trading.

2) Online Account - You need to open online share trading account with any of the available banks or online brokers.

Points to remember while opening online account

a) Make multiple enquiries and try get low brokerage trading and demat account.

b) Also discuss about the margin they provide for day trading.

c) Discuss about fund transfer. The fund transfer should be reliable and easy. Fund transfer from your bank account to account and visa versa. Some online share accounts have integrated savings account which makes easy for you to transfer funds from your saving account to trading account.

d) Very important is about service they provide, the research calls, intraday or daily tips.

e) Also enquire about their services charges and any other hidden charges if any.

f) And also see how reliable and easy is to contact them in case if any emergency. Emergency closing or squaring off trades in case of any technical or other problems

How to choose shares (stocks) for day trading

In day trading, traders mostly wish to do buying and selling on small profits or else they look for overbought or oversold shares. Taking into consideration these important points following basic things you should look in for shares while choosing them for day trading.- Price Volatility- Volume (quantity)What exactly these terms mean and how to use them while Day Trading.

Price Volatility - The Price volatility means the movement (up and down) of share price should be more (or high) through out the day. In other words the fluctuation in share prices should be on high rate so that it will be easy for you to buy and sell on different prices. Suppose if share is moving up and down in very narrow range then on what price you will buy and sell? So it is always better if you choose shares which have high volatility in price movement.Do you want to know how to find out the high volatility shares then please click here?

Volume (quantity) - Volume means trading quantities. The shares which you choose for day trading should have high volumes (or high traded quantity).Why this is required?The high volume indicates that there is more liquidity. Liquidity means lots of transactions had took place on this share and more people are interested to trade in this share. This will ease your trading job because you will get more exposure to the price to buy and sell at anytime. Due to high volumes there will be also high price fluctuations.

Points to remember for day tradingFollowing are very important points to be always remember by day traders.Entry & exit points, stop loss limits, profit targets, your desired risk/reward profile,amount of capital to be committed to trades, how long you need to hold the share if incase it is against your favor.

Why it is required to practice day trading before starting actual day trading?

It’s important to do practice or paper trading before you starts actual trading. Following are the few reasons, 1) Very importantly you will come to know how to place buy/sell orders, and will become familiar and perfect about using your trading system. 2) You will gain confidence in yourself. 3) The fear of trading will vanish. It is very important to keep fear away while doing day trading. 4) You will become active to enter and exit the trade. It’s vital important that you must be pretty fast to enter and exit the trade (i.e. open positions).

Things to study in the morning before starting your day trading or share market trading or Intraday trading

1) Read financial newspaper like Business Standard, Economics Times, etc. If possible note done the high lights/breaking news with respective company names and keep close watch on them for that day.

2) If possible watch share (stock) market related TV channels like Zee Business, CNBC, etc. In these TV channels you get over all idea/movements of all share prices and markets (BSE, NSE). And also it becomes easy to catch and keep close watch on related companies if any breaking news comes out during that day.

3) Especially some share market related websites like capitalmarket.com, businessstandard.com always displays current news, market affairs, share market trends, breaking news and various announcement done by company or government which may effect the share market and related companies. So try to access and have all ok on such types of websites before starting trading and also through out the day, if possible.

4) So in short before starting you stock market trading you should be well aware of all the current news of financial market and if possible note down the breaking news or effective news and its related company and keep watch on that share and trade accordingly on that day.

Important principles to be follow by day tradersNever invest all your money in same sector this method is called as diversification of shares. This will protect your money from downtrends of any particular sector as you can make money from other sector.There are various sectors like IT, Pharmacy, Banking, Steel, Petrol and Oil, construction and infrastructure, auto etc.

Avoid common day trading mistakes like:

(a) Lack of a Trading Plan, (b) Failure to Control Emotions, (c) Failure to Accept and Limit Losses, (d) Lack of Commitment and (e) Over-Trading