Best time of the day for stock trading: All you need to know - IIFL



Best time of the day for stock trading: All you need to know

The stock trade in India begins at 9:30 AM going on until 3:30 PM during weekdays. Stock prices may see drastic movement from their last closing even before the trade begins due to some piece of news that may have come after the close of trade on the last day.

Written by Web Desk Team | Published :December 29, 2022 , 9:03 am IST

A good trade in the stock market is one that is based on research and scientific study of a company’s performance and fundamentals. Unlike investors, who have a long-term goal in mind, stock traders intend to derive profit from short-term price movements. So is there a specific time during the day when buying and selling stocks can give a higher gain? Fluctuation in the share prices can happen at any time, depending on a series of external factors. For example, a good performance report may boost a company’s stock value whereas a sanction or probe by a government agency or cancellation of a contract may affect share prices negatively. Clearly, there is no limit to when and how the price may change during the trading session.

The stock trade in India begins at 9:30 AM going on until 3:30 PM during weekdays. Stock prices may see drastic movement from their last closing even before the trade begins due to some piece of news that may have come after the close of trade on the last day.

Intraday traders, who focus on deriving profit from the stock price movement on the same day, consider the first hour after the opening of the market as the ideal time to trade. They tend to buy and sell during the first few minutes of early trade as the stock prices typically stabilise by midday or intraday trading.
The trading volume and price movement are likely to stabilise in the mid-day hours. Trade done during this period is likely to possess lesser profit potential.

Then again around the final hours or the closing period of the day’s trade, the market sees a movement in stock prices. Traders look to clear their position to book profits. Like the early hours, the final hour of trading is also suitable for traders to buy and sell shares as there are significant price movements, higher trading volumes and many amateur investors also step in for some last-minute gain.
Like the initial and final hours of trading, traders also have their favourite time to buy and sell stocks. Mondays are considered to be the best time to buy stock for a week’s position by many traders. Since the closing of trade on Friday, there could be several developments over the weekend that can affect share prices. Experienced traders prefer trading on Monday due to the pent-up demand since the closing of the trading session on the previous Friday.

Stock trading has become a full-time activity for many while many investors also engage in trading as a hobby. However, making money in the stock market depends on your understanding and knowledge. You can gain more knowledge and learn the secrets of success in stock market by logging in to: https://www.5paisa.com/demat-account

Trading during a certain time window may allow you to increase the chance of profit booking, but only while making an informed trade. Trading in the stock market needs to be based on scientific approach and not just on speculations. Keeping yourself updated with the market news and the development of the company you wish to trade in will allow you to manage your risk better. Before venturing into stock trading, you must realise there will always be a certain degree of risk involved in it.