How to buy and sell Shares/Stock in BSE, NSE & MCX-SX?
In India, BSE (Bombay Stock Exchange), NSE (National Stock Exchange) and MCX-SX (MCX Stock Exchange) are 3 leading exchanges for trading stocks. With these Exchanges, one can trade between the hours of 9.15 AM and 3.30 PM. As we explained earlier, stocks are bought in the primary market, and later it is traded in the secondary market. With stock (cash), you can either trade for Delivery, or for Intraday transactions. You can also trade on other segments like stock futures and stock options, which is explained in other sections (i.e.) futures and options.
- Positional: You buy the stocks, hold it and when you get good profits, you sell it and exit. When you buy stocks, these buy transactions are stored in your Demat account within few days of your buying.
- BTST: Buy Today and Sell Tomorrow: You buy it today and sell it within tomorrow. Here in BTST, you have the privilege of selling the stocks, even before these transactions are reflected in your Demat account.
1. Delivery: Positional - How to buy and sell Stocks (Cash) in NSE OR BSE in online trading?
It's like buying and selling a product. When we say Stock, we are referring to Stock (Cash).
Stock (Cash) Example:
Assume you bought 100 shares (units) of Infosys and each share price was 3000 rupees. For 100 shares, you would have paid 100*3000 = 3, 00,000 rupees.
When the share price reached 4,000 rupees, you sold all shares. So the total profit is (4000-3000) * 100, where 100 is the number of shares you bought = 1, 00,000 rupees. The advantage in this stock (cash) is, there is no need to worry if your share price goes down. You can wait until you share price increases and can sell it later.
Nowadays stock brokers give the privilege of BTST (Buy today and Sell Tomorrow) with less amount. If you are successful, then you square it off; otherwise you buy the same stocks tomorrow.
You either go for long (buy and sell) or short (sell and buy) and you have to close the transactions within the same day (square).
When you trade on intraday, brokers allow you to trade on stocks based on margin. So with fewer amounts, you trade on stocks.
2. IntraDay: How to buy and sell stocks (Cash) in intraday in NSE OR BSE in online trading?
Here in Intraday Trading, brokers determine the percentage of amount you have to pay as a margin.
Wipro is now trading at 400 rupees per share.
If you have to buy (long) 100 shares in regular delivery (positional) mode, you need 400*100 = 40,000 rupees, where 100 is the number of shares.
In Intraday, approximately the margin needed for this stock is only 20% and then you have to pay 20% of 40,000 rupees, which is 8,000 rupees.
With 8,000 rupees you buy 100 shares and sell (square it off) before the trading session ends on that day. Based on the selling price, you get either profit or loss. If the selling price is 500 rupees, then you get 100 (no of share) * 100 (profit per share) = 10,000 rupees profit. If the selling price is 300, then you lose 10,000 rupees.
Similarly, if the stock is bearish (market is in the downward trend), you can also go for SHORT CALLS.
Some brokers even split the margin stocks into several categories like A category, B Category, C Category, D Category and E Category etc.
If you have 10,000 rupees in your trading account, then you get 10 times exposure for A category Stocks. 10,000 * 10 = 1, 00,000 Rupee exposure.
Total Exposure: (Money in Hand) multiplied by (Exposure)
- Category A stock: 10 times exposure: TCS: If TCS is trading at 1000 rupees, then you can buy 100 shares with just 10000 Rupees.
- Category B Stock: 8 times exposure: MPHASIS: If MPHASIS is trading at 1000 rupees, and then you can buy 80 shares with just 10000 Rupees.
- Category C Stock: 6 times exposure: POLARIS: If POLARIS is trading at 1000 rupees, then you can buy 60 shares with just 10000 Rupees.
Comparision between stock delivery, stock intraday, stock future and stock options
Stock Options Commodity Tips