Today we are going to take information about buying and selling of shares. First we will look at the types of trading.
There are different types of trading
1. Intraday Trading
2. Delivery Trading
3. Future and Options
These are all types of trading. We will first learn what is INTRADAY TRADING?
In INTRADAY TRADING, an investor can buy shares after the market opens and sell shares bought before the market closes. That is, the investor has to complete the transaction. In this case, whether the investor is at a loss or at a profit, he has to complete the transaction before the market closes. This transaction is called INTRADAY TRADING.
The second method is “DELIVERY TRADING”. In this trading method, the shares purchased through the trading account are credited to the DEMAT account. And you can keep the purchased shares in your Demat account for any number of days. The shares bought in this are paid in full so we can sell those shares when there is a profit. This means that there is no obligation to buy or sell anything, we can only sell those shares when there is a profit. In Delivery Trading Method you can buy in “SHORT TERM”.
This short term purchase period can be 1 week, 1 month, or 2 months to keep the shares in “SHORT TERM” and can sell at a good profit. The second method of delivery trading is “MEDIUM TERM” in which one can hold shares for 6 months or 1 year. If there is a good profit in this, we can sell it. The third type of delivery trading method is “LONG TERM”. The shares taken in this method can be kept for any number of days i.e. up to 5 to 10 years so that you can get maximum profit. In this long term method, the risk is minimal and the risk is low. In the “delivery trading” method, investors are less likely to incur losses.
The next trading method is “FUTURE TRADING”. In this case, the lot size of a share is fixed by the contract method and a certain period of time is given, which is called CONTRACT. In this case, 3 month contracts work simultaneously in which future work is done in three month contracts such as current month, next month and third month.
In this you can take more risk and get more profit. The lot size of the shares changes from time to time.
The second type is “OPTIONS”. Options is different from futures contracts. In this, the option buyer is called “OPTIONS BUYER” and the seller is called “OPTION SELLER”. There are two types of CALL OPTION and PUT OPTION. If the price of the script or index purchased in CALL OPTION goes up, the buyer makes a profit and vice versa, if the price goes down, the loss is equal to the premium paid. After that the buyer in “PUT OPTIONS” is called SELLER. This SELLER hopes that the script or index (INDEX) will come down and make a profit at such a time, but if the opposite happens then if the script or index (INDEX) rises then the loss in PUT OPTION is equal to the loss of premium paid by them.
We have learned about these three trading methods. But without proper study and proper planning while trading, you will not be able to make money from the market. It is important to study the market for that.
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Thank you.
Good & helpful information