Understanding the value of time in intraday trading


    The one thing you cannot compromise on when investing in stocks is timing. Especially when we are talking about intraday trading, taking the trade at the right time is all that matters to know whether you are making a loss or a profit. Read on to learn more about intraday trading and understand the value of time.

    What is intraday trading?

    As the word clearly states, intraday means “within a day”. Unlike regular trading where you can invest over a long period of time, buying and selling your assets and holdings within a single trading day is called intraday trading. In other words, this means that all positions are settled before the market closes, and there is no change in stock ownership as everything happens throughout the day.

    Before the appearance of online shopping, only professional traders and financial firms participated intraday due to the high amount of risk involved and the domain knowledge required to generate profits. The importance of intraday trading lies in a deep understanding of market movements and when to invest and when to withdraw. Trader’s strategy if trading online is to make a profit by exploiting the changes in the market, and the amount of profit made depends entirely on the degree of volatility of the stocks available in the trader’s portfolio.

    How to choose the right time for intraday trading?

    There is no definitive answer or set theory to answer this question, and there never will be.

    When you’re intraday trading, the one thing you can’t afford to get wrong is timing. And this only comes with a deep understanding of the market that ultimately helps maximize your performance. Even the most experienced traders are prone to losing money when they invest in the wrong stocks at the wrong time.

    It is important to note that it remains highly volatile during the first hour when the stock market opens for trading due to the backlog of orders from the previous business day. Since generally all of the previous day’s orders are filled first, this naturally increases market volatility. Experts believe that from 10.15 am to 2.30 pm is an ideal time for intraday trading. By this time, the morning rush has died down somewhat, and by the same logic, it makes sense to stop at 2:30, just before the market closes, to avoid the exit rush.

    When engaging in intraday trading, it is important to keep in mind that you should not rely too much on the advice of others and do your due diligence before doing so. If done right, it can make you a pretty good profit. Happy investing!

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