How to start intraday trading with 1000 rupees? Sounds like a silly question? It is not! You don’t need extremely huge capital to begin the trading journey in India but yes there are pros and cons associated when trading with low capital.
So, let’s get into the detail to know how to begin the trading journey with the minimum capital.
Can I Start Intraday Trading With 1000 Rupees?
If you are just an ordinary student, housewife, or just a lower-middle-class working professional not capable of trading with a lot of money, you can still start trading with such a minimal amount of just ₹1000.
But to prevent yourself from any losses, make sure you trade in liquid and moderate volatile stocks. Wondering why is it necessary?
Generally, to trade with a low capital, traders get trapped and buy low-value penny stocks which are mostly illiquid. This makes it difficult for the trader to exit their position even if they make a good profit.
In all, there are two things you need to keep in mind to begin and select stocks for intraday trading:
- Trade in liquid and volatile stocks.
- Stay away from penny stocks
Once you filter intraday stocks based on the above parameters, you can trade in stocks falling under ₹1000. So, for example, you bought 10 stocks trading at ₹100, and the stock price increases by 5% then you would be able to make a profit of ₹50.
Good start, Isn’t it?
This is the annual interest rate of FD in most of the banks.
But let’s see the other side of starting intraday trading with ₹1000.
₹50 is the gross profit.
What is the net profit you would be making?
Didn’t understand, well you would be paying brokerage and taxes for the above trade. So let’s say the brokerage is as low as ₹20 and with other taxes, you make a total payment of ₹30. Now this reduces your profit from 5% to just 2% i.e. ₹20.
So, if you are a beginner, there is no harm in starting intraday trading with ₹1000 but you can only focus on learning and understanding how intraday trading works rather than making a profit or loss.
However, if you want to earn 1000 rs daily in share market then it is important to invest more capital and use it wisely in trading.
So, apart from the equity market, you can trade intraday in options as well. Options trading is done in lots, which means you need to pay a premium for a fixed number of shares to buy options. Now if the lot size is high or you choose ATM or ITM options, then trading with ₹1000 is not possible.
But yes, you can buy OTM options with a low capital of ₹1000. Here it is important to mention that although OTM options are cheaper but involve a lot of risk of premium decay. Also, one cannot expect a huge profit in trading OTM options as mentioned in the case of equity intraday.
When it comes to selling trading options with a low capital of ₹1000 is not possible as one has to maintain a minimum margin which could be a few lakhs rupees depending upon the lot size and stock or index you are trading.
If you want to give the right start to your trade, then it is recommended to invest your time to learn options trading before investing money in the market. For this explore the ways of how to trade without money and put some time in learning and practicing the trade setups.
How to start intraday trading with 1000 rupees, is indeed a fascinating question for beginners. 1000 rupees is a very small capital but not so small to start trading and get an idea of the market. Once you learn how the market works, you can start investing bigger capital.
Having said that, for bigger achievements, you need to take bigger risks. To take bigger risks, you need to have immense knowledge about the market and trading, and what exactly you can do to gain that knowledge? Any thoughts? Yup! You are thinking in the right direction!
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