Delivery vs Intraday Trading

Trading in the Indian stock market primarily follows two distinct methods: intraday trading and delivery trading. Intraday involves buying and selling shares on the same trading day, while delivery involves buying shares and holding them in your demat account for days, months, or longer. Each approach carries unique benefits and risks. This article explores how to choose between them based on risk tolerance, available capital, and long-term objectives.

Intraday trading or day trading, consists of buying and selling securities within the same trading session. Positions must be squared off before market close to avoid carrying them overnight. This method often utilizes leverage or margin—allowing traders to control larger positions than their capital would allow. The focus is on short-term price volatility and requires active market monitoring and technical analysis.

Key Highlights:

• No actual ownership of shares—positions don’t get delivered to demat.
  

• Low capital requirement due to high margin leverage.
  

• High brokerage frequency and transaction costs.
  

• High stress, requires full attention and quick decision-making.
  

• High profit potential, but equally high risk of significant losses.

Delivery trading is a strategy where investors purchase shares and hold them beyond the trading day. The purchased shares are credited to your demat account, entitling you to corporate benefits such as dividends and bonuses. This long-term approach focuses on fundamentals, company growth potential, and wealth building.

Key Highlights:

• Full ownership of shares—credited to your demat account.
  

• Requires full payment upfront (no leverage).
  

• Lower transaction costs, though higher per trade.
  

• Lower stress and monitoring compared to intraday.
  

• Potential for capital gains, dividends, and long-term appreciation.

Now that you have weighed the differences between intraday and delivery trading, explore which one aligns better with your risk appetite, time commitment, and financial goals:

Considerations for Intraday Trading:

• Best for: Traders with strong technical analysis skills, high risk tolerance, and time to monitor markets.
  

• Pros: Potential for fast profits, low upfront capital.
  

• Cons: Requires intense attention, high stress, high transaction costs, and significant risk—SEBI data reveals about 70% of intraday traders incur losses.
  

Considerations for Delivery Trading:

• Best for: Investors seeking long-term growth, income, and willing to ride out market volatility.
  

• Pros: Ownership benefits, lower stress, long-term wealth creation.
  

• Cons: Capital is locked-in, exposure to overnight and long-term market risks, slower returns.

Your choice between intraday and delivery trading depends on your financial goals, capital, and risk tolerance. Intraday is fast-paced with potential for quick gains—but higher risk and effort. Delivery suits long-term growth investors who prefer a calmer, research-driven approach. A balanced approach—combining both—can also work: core holdings via delivery and tactical allocations through intraday trades.

This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.