What is Trading And How to Earn Money From Trading. – Hello Friends! You already know that the place where goods are bought and sold is called a market. In the same way, where the buying and selling of shares takes place, it is called the Share Market. The process of buying and selling shares in the stock market is called trading, but this buying and selling is for a short period of time. Investors also invest in the stock market for a long time. In today’s article, we are going to know in detail about this important topic of stock market trading, so what are we waiting for, let’s start reading.
What is Trading?
Buying and selling of any goods and services is called business. This business is common market or stock market everywhere. The only difference is that stocks are bought and sold in the stock market. This buying and selling process is called trading. The person doing trading is called trader, who buys and sells any stock for a short period of time and earns profit. Similarly, investors also buy stocks in the stock market and sell them in a profitable situation after a long time. Trading is a very good medium to earn money sitting at home. (What is Trading)
Also Read – How to take loan from Bank of Baroda
Meaning of Trading
The Hindi meaning of Trading is business. This business is called the process of buying and selling under the stock market.
Traders buy and sell in the stock market in many ways. Information about various types of trading is given here.
1. Intraday Trading
The process of buying and selling any share on the same day by the trader in the stock market is called Intraday Trading. The opening time of the share market is 09:15 AM and the closing time is 03:30 PM. Meanwhile, the stock which is bought and sold by the trader comes under Intraday Trading.
2. Positional Trading
Positional Trading is a type of intraday trading. If a trader sells the stock of a company within a week instead of selling the stock bought in Intraday on the same day, then it is called Positional Trading.
For this the trader has to take delivery of the shares. For which the trader pays the full price of that share to the stock broker. After paying the share price, all the shares bought are credited to the trader’s demat account within 24 hours. After this the trader can sell the stock according to his own. (What is Trading)
3. Scalping Trading
This trading also happens for a day only. But in this the trader does not have the time to buy and sell a stock throughout the day like Intraday. Under this trading, the trader has only a few minutes or a few hours to sell the purchased shares.
If a trader buys shares of a company and if he has 30 minutes to sell that share, then he has to sell it within 30 minutes. This trading is very common in the stock market because with the help of this trader earns a lot of profit.
4. Swing Trading
Under this trading, the trader has 3 to 4 weeks to sell the purchased shares. Meanwhile, if the price of the purchased stock increases, then the trader sells the purchased stock. The risk is slightly less in this trading.
5. Short Term Trading
As the name suggests, this trading will be for a short period of time. When a trader sells shares of a company by keeping them for a few weeks or a few months, it is called Short Term Trading.
6. Long Term Trading
Its name clearly shows that this trading will be for a long time. When a trader holds and sells the shares of a company for 1 year or more, it is called Long Terms Trading. Its advantage is that there is less risk in this and there is enough time to sell thoughtfully.
What is online trading?
The process of buying or selling Digital or Virtual shares of any company in the share market is called Online Trading. To do online trading today, many Best Trading Applications can take the help of financial institutions and stock brokers. To do online trading you need a Demat Account and Trading Account.
At present, it is very easy to do mobile trading in the share market. There are many reliable apps for this, such as – Upstox App or Groww App. For this you have to complete the process of KYC. On completion of KYC, your demat account will be opened in 2 days. After account opening, you can start trading by adding money to your demat account. (What is Trading)
How to earn money from trading?
Making money from trading is a vast subject and there are many factors you need to keep in mind in order to be successful. Here are some important ways through which you can earn money from trading.
- Detailed Study – This is the most important element that will bring you success. You should make a detailed study about various financial instruments before investing.
- Use a demo trading account – You should practice as much as possible by opening a demo trading account so that you are ready to achieve success.
- Prepare a Financial Plan – To prepare a successful trading plan, you need to think about your investment goals, financial limits and investment feasibility.
- Choose the right tool for investment – You will need to choose the right tool for your investment like trading platform, news sources and other tools.
How to choose the right stock for trading –
- Before buying the stock, one must see the graph of market fluctuations.
- Trading should not be done against the market rate.
- Trading should be done leaving behind your fear and greed.
- Fake stock should not be paid attention to.
- It is necessary to research well before buying shares.
- Before buying shares, decide which shares you want to buy and how much you want to keep the target.
- Before buying shares of any company, find out whether the company’s position is strong or not.
- If there is news contrary to that company in the stock market or news, do not trade on its stock.
- Trading in the stock market is risky, so invest according to your capacity.
How to start trading in share market?
To start trading in the share market, you need to have a Demat account, trading account and a bank account. If you do not have these three accounts then you will not be able to start trading in Share Market.
You can open your Demat Account and Trading Account with the help of Online Trading Application given below.
Any type of trading or investment involves financial risk. We do not provide any kind of trading or investment advice. If you invest or trade, then invest with your own responsibility.
How did you all like the information about trading? You must share your thoughts with us in the Comment Box. Hope you all must have liked this article, then do share it with your friends.
Read Also – What is Cryptocurrency And How Does it Work?
Trading Related FAQ –
What is the Meaning of Trading?
Trading means ‘business’ in Hindi.
What is Trading?
Trading is a financial activity. In which various financial instruments like shares, currency, commodities, bonds etc. are bought and sold.
How to Do Trading?
You can do trading by meeting a stock broker or with the help of any online trading application (Groww, Upstox, Zerodha etc.).