In my last article, I listed some of the best demat accounts in India. If you want to carry out intraday trading, none of the accounts on that list will be suitable. I have compiled a list of the best demat accounts for intraday trading in India by 2022. This list is based on the cost-effectiveness and only includes reputed brokers.
Intraday Trading
Intraday trading is the buying and selling of shares on the same day. Delivery trade is when you don't sell the shares on the same day after buying them.
The demat account is credited with shares purchased via delivery transaction.
If you are trading intraday, the trade must be closed by the end of the day. Your broker's risk team will close the trade if you do not.
Why do traders engage in intraday trading?
Intraday trading has both pros and cons. I believe that intraday trading is not a good way to earn money long-term. There are still traders who earn their living from intraday trading.
Intraday trading has many advantages
The margin offered by the broker can be used. Brokers usually provide exposure between 3-20 times, which can help you make more money.
Intraday trading is free of overnight risk.
Trading positions can be initiated both long and short, i.e. buy first and then sell.
Contrary to F&O, where you have to purchase a fixed number of lots (shares), you can trade intraday with just one share.
Intraday trading: Disadvantages
After deducting all expenses like brokerage and taxes, the profit margin is very low
It is difficult to predict the price movements in the short term
The physical strain and fatigue that comes with having to constantly watch the screen all day long
Tips for choosing the best Demat account for intraday trading
You will find some tips on how to choose the best demat account when trading intraday.
When opening a demat account, you should consider and evaluate the following parameters.
It is important to consider a low brokerage fee without hidden costs. The lower the brokerage fee, the higher the profit. (Read:Lowest Brokerage Charges demat accounts in India)
Margin/Exposure/Leverage offered by the stock broker: Though exposure is important, dont go with the broker who provide unreasonably high leverage. Your funds are at risk if the broker goes bankrupt due to default by a trader. List of top Stock Brokers with Low brokerage and High Leverage
AMC (Annual Account Maintenance Charges): Some brokers will mislead you by telling you that it is a free demat account. There is no AMC in the first year. From the second year, they charge a hefty AMC.
Stability of Trading Platform: For intraday trading, your trading strategy and the platform that you use to place the order are both important. If the platform is unstable, your profit-making position can quickly become a loss. (Read: Best Trading Platforms in India).
Usefulness of Mobile Apps and its Features: Though intraday traders mostly use desktop applications, sometimes mobile apps come in handy when they aren't in front of the system. (Read: 7 Best Mobile Trading Apps of India)
Best Demat account for intraday trading in India 2023
You can save a lot of money by using any of the demat account for intraday trading.
Here is a list of the 5 best demat accounts for intraday trading in India.
Zerodhademat account for intraday trading
Upstox intraday demat account
Angel Broking intraday trading demat account
5 Paisa demat account for intraday trading
Trade Smart Online Demat Account for Intraday Trading
Zerodhademat account for intraday trading
Brokerage charges: Rs 20/executed order. Zero brokerage for delivery trades (Investments)
Intraday margin: 3x to 14x