Stock Market Tips for Indian Traders

01Start in the cash segment before F&O

Learn stop-loss and position sizing in cash market stocks first. Futures and options use leverage and lot sizes, so every mistake costs more there.

Move to stock futures or options only when you follow your rules without exception.

02Write the plan before you enter

Before you buy or sell, know five things: entry, stop-loss, targets, quantity and exit time. If any one is missing, skip the trade.

A plan written in advance stops you from making decisions in the heat of a fast move.

03Put a stop-loss on every trade

Place the stop-loss order as soon as your entry is filled, or use a bracket order that places both together. Never move it further away to “give the trade room”.

Our intraday risk management guide explains stop-loss types in detail.

04Risk only 1% of your capital on one trade

Decide the most you will lose on a single trade, then work out the quantity from the stop-loss. This keeps every loss small and similar in size.

Try your own numbers on our position size calculator.

05Trade only liquid NSE stocks

Stick to stocks with high daily volume, such as those in the F&O segment. Tight bid-ask spreads mean you can enter and exit near your price.

Avoid penny stocks, thinly traded stocks and stocks stuck at the upper or lower circuit. You may not be able to exit when the stop-loss is hit.

06Read the market before 9:15 am

Most intraday moves follow the broader market. Before the open, check the global cues, where Nifty and Bank Nifty stand and which stocks are gapping.

Use our free pre-market report, Nifty levels for today and gap up and gap down stocks.

07Let the opening swings settle

The first 15 to 30 minutes after 9:15 am often bring sharp moves in both directions. Many traders wait for the market to settle before acting on a setup.

08Never average a losing trade

Buying more of a stock that is falling against you doubles the risk on a trade that is already wrong. In intraday trading, a small loss taken early is part of the plan.

09Book in parts and trail the stop-loss

When the first target comes, book part of the quantity and move the stop-loss to your entry price. The rest of the position then runs with less risk.

This is why our calls carry three targets instead of one.

10Use intraday margin carefully

Brokers allow intraday positions larger than your cash through margin. That also makes every loss larger. Size each trade on your own capital, not on the margin available.

11Know your charges and tax

Every intraday trade pays brokerage, STT, exchange charges, GST and stamp duty. On small price moves, these costs make a real difference.

Intraday equity gains and losses are treated as speculative business income for tax. Keep records, and check with a tax adviser.

12Set a daily loss limit and keep a journal

Stop trading for the day once you hit a fixed loss limit. Revenge trading after a loss is one of the fastest ways to damage an account.

Note every trade: why you entered, where you exited and whether you followed the plan. Review the journal every week.