I've looking into this day trading for quite sometime and I haven't actually started trading. I've decided not to get into it till I get my fundamentals right.

One of the questions I have in mind is,

Say if you buy 100 shares of a company at 50 Rs. And in the mid day the prices go up by 2 Rs. Now you want to sell it.

1. Can you sell it immediately before the prices go down?
2. If so, who buys the shares when prices are high?
3. If the price hits 52 Rs at 2 o'clock in the afternoon and i initiate this trade immediately, How long it takes to get over?

My questions might not make sense to advanced traders but kindly put in your comments. That'll help me learn one or two about this trading.

"Rookie Question about Day Trading"

Rookies should not be getting in to Day Trading.

Do yourself a favour and stick to good advice published elsewhere on this site . In fact Alchemist has advised in some other thread that for Rookies, the best way would be to apply for IPOs that have heavy demand and sell on listing. While this is also not without risk, the risk-reward ratio is favorable.

Dude. You are missing the point. I said i wont get into that till i'm clear on all the stuff. Not like I'm going to start trading once you answer these three questions. It'd have been nice if you had enlightened me with the answers and then gave the advice.

Advice taken. Answers anyone?

Since you insist:

1. Can you sell it immediately before the prices go down?
A. All Day Trades MUST be matched during the day, if you bought some shares, you MUST sell them later during the day. If you don't, the broker will do it for you at the end of the day. This means if you bought at Rs 50 and stock starts to drop, you WILL book a loss. You cannot carry forward to the next day.

2. If so, who buys the shares when prices are high?
A. "High" price is relative. What is high for you may be "low" for someone else if he feels prices will rise further.

3. If the price hits 52 Rs at 2 o'clock in the afternoon and I initiate this trade immediately, How long it takes to get over?A. If someone is willing to buy at Rs 52, you sell trade will be executed as soon as you place the order. If no one is willing to Buy at Rs 52, you trade will wait until someone comes in later in the day to buy at that price. Worst case, broker will square off at the end of the day. It is not possible to predict the price as which the broker will square off.

Let me clarify a few things.

When a client places an order with a broker, the broker may or may not ask the client to specify if it is a day trade or delivery trade.

If the trade is done using margin or if the trade is specified as a "day trade", the broker may or may not close the position at the end of the day.

e.g. In case of Kotak Securities, clients may take a margin position, but Kotak Securities does not close margin positions at the end of the day. (I am referring to "Normal" market orders).

e.g. I may have only Rs 10000 in my Kotak Securities account, but if I buy 5 shares of Infosys worth Rs 15000, Kotak Securities will not close my buy position at the end of the day.

Some brokers close-out such margin positions.

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In case of some brokers, positions specified as "day trades" are closed-out even if the client has enough cash balance to take delivery.

In short, whether a day trading position is closed-out or not, entirely depends on the policies of the broker.

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Coming back to the original questions:

1. A client can close his open positions any time, but some some brokers compulsorily close-out open positions around 3 PM.

2. As stated by sudhashbahu, there is no absolute high or absolute low in a market.

When a trade is done, the seller thinks he is selling at a high price and the buyer thinks he is buying at a low price.

3. Trades can be executed in real time, if the trader is willing to accept the market price.

Remember, price that is mentioned by the exchanges is historical price. The price of the last trade is considered as the price of a stock.

If a trader wants to know what price he will get, he first needs to a look at the order book before initiating a trade.

The order book display the best 5 buy and best 5 sell orders.

If I try to explain how the order book works, it won't be easy to understand for a newcomer.

It is best that a newcomer look at the order book and see how it changes with time. He will understand how the system works.

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Alchemist, please delete my post #4 in this thread as it has incorrect information.

What exactly are you referring to?

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This is a question that I have often wondered about. When people sell us shares at low price or buy from us when prices are high, are these people who bought a year ago and now prices are 'high' for them so they are selling, and for others, prices are 'low' so they want to buy at today's high price and sell them a year later?

One more question I'd like to add.

Say I have some 100 shares. I'd like to sell the share for 52 Rs. But I can't find a buyer at that price.

1. If no one wants to buy my share how will the broker sell it?

2. After sometime I decide to sell the share at 45 Rs (Current Market price 52Rs). What happens if still no one wants to buy that share?

If there is no buyer at 52, you can't sell the stock at 52.

1. Either you have to sell at a price at which there is a buyer

or

2, You can place an order at 52 and wait for buyers to come and buy all shares.

As I said earlier "Price" in a market is the last traded price.

Last traded price is history.

You can only sell at a historical price if there are buyers at or above that price.

Look at the order book for Euro Ceramics.

The "Last Price" is 30, but if someone wants to sell at 30, he won't be able to sell as there are no buyers at 30.

If someone wants to sell 100 shares, he will either have to accept the price of 29.45 or keep an order at 30 and wait.

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