Finance Frontier

The number of participants in intraday trading is on the rise in India. While a large number of people do participate in intraday trading, there is no guarantee of profits. In this article, we will look at the strategies you could adopt to maximise your chances of earning profits in the stock market. Without wasting a second, let’s get started.

Profit Maximising Strategies

Let us look at the strategies to maximise profits in intraday trading.

1. Scalping Strategy

The scalping strategy is one of the most significant strategies for making short-term gains in the stock market. With time frames ranging from a few seconds to fifteen minutes, the focus is on accumulating profits on your stock trades. All you have to do is keep a keen eye on the minor price fluctuations in the market.

Controlling emotions is one of the most essential components of this trading strategy. You must learn to control your emotions to prevent losses from escalating and avoid short selling to capitalise on stock rallies. Instead of falling for big profits quickly, you should keep an eye on making modest gains consistently over a sustained period. Opening a demat account for free is now at your fingertips. Open a free demat account with smctradeonline.

2. Momentum Trading Strategy

Stock trading based on recent price trends is known as momentum trading. The underlying assumption of this strategy is that stock prices will continue to move in a particular direction for a while.

This sustenance of prices (at least for a short while) is known as momentum in the market. Traders capitalise on this momentum to make gains. News and events impact stock price movements.

This strategy also includes placing orders based on expected momentum after public news or recent developments. Major policy announcements, regulatory changes, and geopolitical and geostrategic developments also trigger volatility.

This strategy uses all financial instruments, such as stocks and commodity derivatives, to make gains even during market bloodbaths. You could refer to authentic sources on commodity derivatives for more details on making profits during bearish market runs. Informative finance blogs of SMC Global Securities are one such option.   

3. Pair Trading Strategy

As the name suggests, pair trading involves trading stocks in pairs. The crux of this market strategy is identifying stocks in pairs whose prices are correlated and often move together.

However, your focus area in this strategy must be balanced but imbalanced. When the price of one stock outperforms the other, you have to capitalise on the relative gains. You can make gains out of the temporary imbalance in pricing between two correlated stocks.

4. Breakout Trading Strategy

The breakout trading strategy is based on identifying support and resistance to a particular stock’s price level. These levels are used to determine the price levels whichthe stock has struggled to break through.

When the stock’s existing price level (LTP—Long Term Price) breaks these levels, it indicates the beginning of a new trend. When the stock’s existing price level breaks past the resistance level, it enters a buy trend, and when it goes below the support level, it qualifies as a sell stock.

Conclusion

Buying and selling of shares can involve a significant amount of risk. There’s no point risking your hard-earned money if you do not have a sure-shot strategy to excel in the market. In this article, we have gone through techniques to help you maximise your profits.