Is it possible to earn 5000 per day or more from Intraday Trading ? yes It’s possible let’s understand how ?
If we talk in general term to earn 5000 per day is not an easy task, because in 9 to 5 Job it is very difficult where you can get 5000 daily or 1,50,000 Monthly as a salary. To get that position you need lot of expertise and experience.
Here in Share Market it is easy in comparison with other private job. But yes off course it’s not so easy , to achieve this goal you need a disciplined in your trading style, a strong mindset and a obviously a good skill. Apart from these things lets understand other things that is must need to earn 5000 per day.
Intraday Trading Strategy
In Intraday you can achieve this goal by two methods – simply trading in Cash Stocks and second by trading in derivative segment that is Future and Options (FNO). Let’s discuss them one by one—
Trading in Cash Stocks
Trading in cash stock is easier than trading in derivative segment, because FNO trading is a high risk and high gain instrument. And as a beginner trader if you want to learn then it is suggested to start trading via cash stock.
Before start trading you should be familiar with technical analysis, in technical analysis you learn the way how to analyze a stock, how to read the chart, how to find the stop loss , what should be your target, the entry and exit points, the support and resistance that is demand and supply zone and using different types of indicators , with the help of them finding the trend etc. There is lot of things before starting your trading you learn in technical analysis.
This is the first point, we are assuming you have the knowledge of technical analysis and you can predict the trend of a stock and can find target and stop-loss easily.
So next thing is your Trading capital, especially if you trade in cash segment stocks then you need minimum 2,00000 INR to start your trading.
Let’s understand why this capital is important?
For your trading you only need to use 1,50,000 INR to buy stocks, remaining 50,000 INR will be reserved.
Suppose you choose a stock with 500 INR price, and you get the profit of 2% that is 10 rupees.
With your capital you can buy 300 shares, so after booking profit of your first trade your earning would be 3000 rupees.
Suppose your prediction don’t work and stock hit your stop loss, and you got loss. Later if you find next trade then again you should have trade with 1,50,000 the losses will be from remaining 50,000. That’s why we are not using the full capital of 2,00000.
When you trade with full capital that is 200000 INR
Suppose in your first trade you got loss of 1000 rupees, then next time you will have to trade with only 199000 rupees, If you got two loss one by one then you would have only 198000, rupee to trade, and your purchasing power will also decrease. That’s why we keep 50,000 as a reserved and only trade with 1,50,000 rupees.
Here are the Tips to Earn in Intraday Trading
Things to keep in mind
Do your previous day stock research properly
After market hour, you need to do your stock research and find those stocks which you think next day can breakout or give a good move, and maintain the list of these stocks in a separate watch list, next day you should find the trade in these listed stocks.
Decide your intraday stop loss and maintain it
In day trading stop loss plays an important part because it can stop you from unlimited loss. In intraday we generally decide 0.40% to 0.50% of stop loss, because your target should be 1 to 1.50%, so you can’t take too much risk in intraday.
Second thing most of the trader only keep the stop loss in their mind; they don’t apply it, when stock hits their stop loss and in the hope of recovery, at the end they got huge loss. There for in intraday trading must use stop loss and maintain it.
Avoid Over trading
In day trading most of the traders earn profit but at the end they pay more than their earning, this is because of over trading.
In other situation some traders got profit in starting and later they loose their earning and got some loss, then to recover that loss they put lots of trade in revenge, and at the end they lose a big part of their capital. So avoid overtrading.
How many trades in Intraday
There is no fix rules that how many trade you should take in intraday, it varies trader to trader but as a beginner you should take maximum 3 to 4 trades.
Only trade in liquid and volatile stock
For day trading you should only choose the liquid stocks, liquids stocks means there lots of buyers and sellers are available, you should avoid those stocks where you find a large gap between buyer and seller. You can check it in market depth section of any stock. For example Nifty stocks are liquids stocks.
Second point you should pick a volatile stock which gives generally 3 to 4% of move in intraday, we can only trade if the stock move upside or downside, if you choose a stock which give 0.50 to 1% move than how will you trade.
You should also avoid highly volatile stock, which give 8 to 10 percent of move each side very quickly, in these stock you can lose a big amount, so avoid these stocks.
Don’t trade against the Market
You should avoid trading against the market, If the market sentiment is negative and majority of stocks are falling then you should not go for buying any stock for day tading.
It is always said trend is your friend, so always try to trade according to market trend, if most of the stocks of any sector is trading in red zone then you should choose a stock to sell not to buy.
Find proper entry and exit
Try to find a stock which bounce from its support zone and and sell those stock near resistance zone because in these trade your stop loss be very small. Before your entry you should properly analyze the stock, if your entry would be easy then your exit will be tough, on the other hand if your entry is hard then your exit will be easy, means If you take a trade without proper research then you could be in loss.
Avoid News based and result day stock
You should avoid news based and result day stock because because of news they can move any side violently and can hit your stop loss, similarly in result day stock as the result comes stock goes highly volatile and you cannot control your trade , so it would be better to avoid those stocks, there are lots of other stocks to trade.
Manage your risk rewards
Before buying any stock you must check the risk reward is favorable, for example suppose a stock moves 3% daily on an average, and stock had already given the 2.5% move then you should not buy that stock , because when the correct will start then you could stuck in that trade. You should generally follow 1:1 or 1:2 or 1:3 risk rewards, for example, if your stop loss is 5points then your minimum target should be 5 rupee. If your target is less than your stop loss then you should not enter into that trade.
Book your profit
This is very important part because you trade to gain some profit, if you are in a profitable trade and your target is achieved or stock is reached at certain resistance level then you must book your profit and stay calm for some time. Don’t be greedy to expect some more, what ever market is giving you just take it and be happy. Otherwise you will lose those gains.
Second thing if you think stock could go even more then at least you should book some part of your profit and trail your stop loss so that if stock corrects then you could save your gain.
Never hold your loosing trade for next day
In intraday most if the trader hold their loosing trade for next day, if today they are in loss then they don’t cut their trade, in the hope they imagine next day stock could reverse and recover their losses, and next day they got more loss. So it would be better to accept today’s loss and accept it, and cut your trade. Next day you might find next opportunities. So never hold your losing trade for next day.
Properly follow these rules with discipline
Next rule is properly follow these rules for intraday trading with discipline. Otherwise leave the market, because without following these rules you will got loss each and every time, and finally you will go on the way of bankruptcy.
These are the perfect rules by following these with discipline you can earn 5000 per day and even more in intraday trading. I have written these rules as based on my own experience and follow them properly. What you say please write your suggestion in the comment section. Thank you for reading.
How to earn 5000 per day from intraday trading?
Buy following proper intraday trading strategies and rules you can earn even more in intraday
Can I earn 5000 or more in future and options?
Future and Options is a high risk and high reward segment, you can earn even more but other side with high risk.
Is the knowledge of technical analysis is necessary for intraday trading?
Yes technical analysis is the back bone of intraday trading, without it you can’t imagine intraday trading.
Nirmal is a NISM Certified Derivative Trader & the Founder of InvestandEarn.net (Financial Blog). He entered the world of Equity research to explore his interests in financial markets having 5+ Years of Experience in Share Market Trading & Investing. Nirmal frequently writes about Share Market Trading & Investment and publishes his personal view on the market. Drop him a mail at firstname.lastname@example.org.