Intraday trading is buying and selling stocks within a single trading session to profit from short-term price fluctuations. In contrast, Positional trading refers to a long-term strategy in which traders have to hold the stocks for a comparatively longer time.
Whether you use intraday trading or positional trading solely depends upon whether your goals and objectives are for the short run or long run, respectively. To understand the difference between intraday and positional trading, read this article. We‘ve crafted a simple and effective comparison below.
What is Intraday Trading?
Intraday Trading refers to buying/selling shares on the same day using the online trading platform. The main aim of the intraday is to make profits through short-term price fluctuations.
Overall, you have to make several trades in a single trading session and settle all the positions before the market closes at 3:15 PM. This fast-paced trading requires you to know active monitoring, technical analysis skills, and high tolerance risk factors.
What is Positional Trading?
Positional Trading refers to holding a trade position for a longer time period than a day, such as several days, weeks, or even months. Simply put, you have to hold the position for a longer time to have the benefit of long-term price appreciation.
Positional Trading has diverse timelines and requires you to proficiently learn technical and fundamental analysis to make successful trades.
If you’re also planning to start trading, you might want to check out Upsurge.club’s courses on share market basics for beginners.
What is the Difference Between Intraday and Positional Trading?
Let us understand the difference between intraday and positional trading.
| Aspect | Intraday Trading | Position Trading |
|---|---|---|
| Time Frame | Executed within a single trading day | May take days, weeks, or months |
| Objective | You capitalize on intraday price fluctuation in the underlying market | You capitalize on medium-term to long-term price movements in the underlying market |
| Trade Frequency | Take multiple trades within a single trading day | Take only fewer trades over a long period |
| Analysis Technique Required | Utilize technical analysis and short-term price pattern | Utilize technical analysis, but highly relied upon fundamental analysis |
| Capital Required | Leverage facility available for the traders that require lower capital | Requires higher capital due to holding long-term positions |
| Costs Incurred | Requires higher costs because of a higher number of trades | Requires lower costs due to fewer trades |
| Tools and indicators used | You have to use tools and indicators like intraday charts, moving averages, intraday volume, RSI, Bollinger Volume, MACD etc. | It includes using tools and indicators like debt-to-equity ratios, long-term moving averages, economic data, and financial ratios such as P/E, P/B, P/S, and more. |
| Risk | Involve price volatility risk | Involve systemic and overnight risk |
Conclusion
These are the major differences between intraday and positional trading. Trading with intraday or positional trading completely depends upon your goals and objectives. The key is to understand your needs and take a step accordingly. I also would like to suggest Upsurge.club’s online trading courses to uplift your trading game.
