Trading Intraday Full-Time? A Realistic Perspective

8 apr

Hi folks! Some of you may find this interesting. Check it out.

The Allure of Intraday Trading

In recent times, there's been a noticeable shift towards intraday trading, captivating many traders who are drawn by the prospect of swift profits and the dynamic nature of real-time price action. The constant engagement with charts and the immediate feedback can be exhilarating, a stark contrast to the perceived monotony of positional trading. Positional trading, on the other hand, requires less constant monitoring but demands a deeper understanding of market fundamentals and other influencing factors, often involving a more significant learning curve that many traders seem hesitant to undertake.

Youtubers' influence

Unfortunately, online finfluencers portray intraday trading as an easy activity to generate profits in their Youtube videos thereby fueling this attraction for many traders.

The Capital Conundrum and Return Expectations

Both intraday and positional traders enter the market with the primary goal of generating returns. However, a common observation is that intraday traders often operate with smaller capital bases. This hesitancy to deploy larger amounts likely stems from a fear of significant losses. This raises a crucial question: if your technical analysis presents a high-probability trading opportunity backed by your experience, why the reluctance to capitalize on it with more substantial capital?

The Stress Factor: A Daily Battle vs. Periodic Pressure

Trading, by its very nature, exposes individuals to stress due to the inherent risks and uncertain outcomes. While both intraday and positional traders experience this pressure, the intensity and frequency differ significantly. Intraday traders face this stress on a daily basis, compounded by the necessity to close out all positions by the end of the trading session – a constraint positional traders don't face. Furthermore, many intraday traders fall into the trap of feeling obligated to trade every day, often forcing trades where no clear opportunities exist.

Professional Context: Trading as a Primary vs. Secondary Activity

Positional traders are often individuals who have established income streams from other professions. Their trading activities typically involve deploying surplus funds, which often allows for larger capital allocation.

The Economic Realities of Full-Time Intraday Trading

Considering the current economic landscape in India, a comfortable monthly budget for a small family can easily reach or exceed Rs. 2 lakhs. If one aims to achieve this level of income consistently through full-time intraday trading, it necessitates a substantial capital deployment and a consistently high level of profitability on trades.

A Call for Realistic Self-Assessment

How many aspiring full-time intraday traders truly acknowledge these financial realities and seriously evaluate whether their chosen path is a sustainable and profitable one in the long run? If intraday trading is pursued merely as a hobby, it might represent a missed opportunity to utilize one's prime years in more productive endeavors.

Therefore, if you are contemplating or have already embarked on the journey of full-time intraday trading as your primary source of income, it is crucial to have given the decision thorough and realistic consideration before taking "The Leap."

Please feel free to reach out to me to share any queries or comments you may have.

Best regards to all.
PriceCatch

9 apr

Nota

Since I wrote this article, I did not expect that this much interest would get generated as many traders appear to be reading it. I only hope that if you are an intraday trader, you give a serious thought to what I have written above if you want to continue doing it. Honestly, if you target a net return of say Rs.1 lakh per month, then calculate how much capital is required or if you cannot deploy that capital, how many profitable trades are needed. Even if you make a net profit of Rs.3K per day, even then after 20 trading days in a month, you would have made only Rs.60K. So, with today's cost of living and increasing inflation, is it sufficient? Question yourself honestly because it matters to you!