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World Finance

Author: Michael Widianto Page 1 of 57

Intraday Vs. Interday Trading: Everything You Should Know

Intraday Vs. Interday Trading: Everything You Should Know

Thousands of traders seek to make profits in the stock market every day. But stock trading is not everyone’s cup of tea, and losing money seems to be a lot easier than booking profits. So, investors apply intraday and interday trading strategies to make the best use of their resources.

A trading strategy is chosen on the basis of the investor’s risk appetite and investment horizon. The choice also depends on the type of security the investor wants to deal with. Each of these trading strategies has different rules.

Intraday Vs. Interday Trading: Everything You Should Know

Basics of intraday trading and interday trading

Intraday trading relates to trades being settled in a single trading day. In contrast, interday trading involves trading that takes place over more than a single day. Both these trading techniques are short-term trading strategies. So, they focus on short-term trades.

However, the two strategies are distinguished by their respective approaches towards trading, time horizons, and risk profiles.

Before you start trading, it is essential to open a trading account with a broker like Kotak Securities. Now, you can decide on your goal and set the trading strategy accordingly.

Differences between intraday and interday trading

In case of intraday trades, the trading horizon is much shorter and usually lasts a couple of hours. Here, investors buy securities after the market opens and square off the position before it closes. For this reason, it is popularly known as day trading.

Interday trading has a longer trading horizon. The securities are held overnight and even for a few days. Traders following this strategy select stocks based on fundamental analysis.

Facts to consider

Intraday trading is widely chosen by investors looking to make quick profits from small fluctuations in stock prices. They make profits on opening and closing stock prices. The accessibility of margin loans makes it a lucrative trading strategy. A day trader can easily fetch up to 10x leverage compared to an interday trader.

Benefits of intraday trading

  • By using margin loans, you can purchase shares without paying the full price.
  • Brokerage charges are lower for intraday trades as opposed to interday trading.
  • Intraday trading allows you to short-sell stocks and earn profits without owning them.

Drawbacks of intraday trading

  • Whether the company performs well or not, you should sell the shares within the same trading day.
  • You need to closely monitor the market as well the company you have invested in. Any event-driven factors can impact the stock price.  
  • To make substantial earnings, you need to purchase a large volume of shares.

Tailpiece

Are you looking to reap profits as quickly as possible? In that case, it’s advisable to go for intraday trading. The goal is to gain a little on each trade and then compound those over time. On the other hand, interday trading is about more than analysing the movement of stock prices. It requires a lot of research as well as fundamental analysis.  So, this type of trading would be suitable for you if you have the patience to accrue … READ MORE ...

Asset Finance: Deals With Elusive Assets

Asset Finance: Deals With Elusive Assets

As the ever increase in competition and the scrupulous mechanism of every organization, every company needs regular amount of flow regarding capital and cash that ensures all the mechanism and related details are running smoothly or not. In any type of business, competitor always looks forwards to get a chance to become the leader in that race. That’s why it becomes very important to make sure about the adequate cash and capital ready when ever there is a need to use them.

Capitals may be required for many reasons like buying commercials vehicles, machinery, used and new equipments and some other important things. It’s not possible for any business owner to extract money every time from the company’s account as it directly affects your working capital. That’s the main reason why asset finance comes into role. Asset finance is very useful as it helps in raising the amount of money for buying the assets and the money can be returned back to the finance company through several installments over a contracted period of time.

Hire purchases, lease purchases, finance leases and operating leases comes under asset finance and they are very common and used by most of the business owner to run their capital amount smoothly. Asset purchase is the most common form of this. Hire purchase is very useful as it permits the owner for preparing a contract than deposit the contracted percentage of money and then the monthly hire fee for using the equipment. Once the amount has been repaid by you than there is an option for you whether you choose the equipment or return back it to lender. Lease purchase is almost similar to hire purchase but with a slight difference that you can pay money in several installments rather than paying the upfront percentage that is available in the hire purchase.

Another category of asset finance is financial lease, in this the finance company is the owner of the asset. You can take the asset form the finance company on rent for a particular period of time. In this you don’t have the rights to sell your asset as you are not the owner of the asset, in other word means you can’t sell your asset without the prior permission of the company as you are not the owner of the asset. In all Asset Finance plays a very imperative role and it is totally independent of the size of the company.… READ MORE ...

Financial assets and benefits

Financial assets and benefits

What is Asset Finance? Basically it is a financial arrangement with which you have the power to buy a company, a new car, used equipment, machinery or other office equipment. You can get this loan quickly because the process is not as long as other loans have. Many companies now use such loans to expand their infrastructure and this adds more choices to the growing popularity of affordable financial solutions.

Some of the main benefits of using Asset Finance are as follows:

1. It helps in saving current capital. Buying new equipment definitely requires a massive capital investment which sometimes prevents company owners from investing in other projects. But if you save less rent than can be used in several other projects or in other activities. This will definitely direct the company to adopt new businesses quickly and provide new opportunities.

2. It also helps open up many ways to respond to opportunities. It makes you stand during unwanted circumstances. This is very valuable to businesses, especially so they need easy financing solutions to keep pace with technological developments.

3. With asset financing you can easily manage your budget. It also helps facilitate regular payments for a fixed period, which makes you relatively free from other inflationary pressures or changes in interest rates. Therefore it becomes easier for companies to plan their budgets and capital.

4. It also plays an important role in maintaining existing credit. It also helps you in maintaining other existing credit from banks or other financial institutions. Another major benefit is that if necessary you can use other banking services simultaneously.

5. Another benefit of this is the flexible nature which is very useful. In addition to each agreement there are careful arrangements given to lenders’ requirements.

6. There is no need to deposit anything with the loan. To request such a loan there are no hard and fast rules so that the borrower only needs to make regular payments to repay the loan under a certain tenure.

Financial assets are the best way to handle financial situations. You can use according to your needs as needed to improve your business. The following are the types of asset financing: a. Rent Buy b. Rent Buy c. Lease Contract d. Financial Leases e. Operational Leases

Overall, there are many benefits to using asset financing because this is an opportunity to finance your business. You can save a lot of capital that you can use in several other projects.… READ MORE ...

Angel Investor Vs. Venture Capital Database - What Are The Main Differences?

Angel Investor Vs. Venture Capital Database – What Are The Main Differences?

In this article I compare Angel Investor vs. Venture Capital Databases to identify the main differences?  Of course, the primary difference is the investors in each database; i.e. the angel investor database includes angel investors while the venture capital database includes venture capital firms.  So, then you may be wondering “What is the difference between a VC firm and an angel investor?”

The main differences between angels and venture capitalists are as follows:

Investment Size: The size of investments differ by investor, but most often an angel will commit a much smaller amount of capital to a small business or entrepreneur than a venture capital firm would.  This is true for a number of reasons including: the stage of the business, investable income, risk and structure of the investor and/or fund.

What is the stage of the business?:  This is a very important consideration, because angels typically invest in small businesses at the really early stages of the firm.  This requires a lot deal of risk which lowers the investors’ capital commitment.  (Would you place a larger bet on something with a 70% of success or with a 30-50% chance?)  But that’s often not a big obstacle to the small business because in the first year or so of operation, the business needs less money from outside investors.  But when the company has matured and proven it has the management team or the business idea that could develop into a bigger and more lucrative business, a venture capitalist might step in.

Structure of the fund:  An angel investor is usually a retired business professional or current business professional who was successful enough in his or her career to have a store of capital for investment in businesses like yours.  A venture capitalist though is a professional investor that manages a fund for a group of investors.  This is a big difference you should consider when deciding which investor you’d like to partner with.… READ MORE ...

Venture Capital Investments and Its Contribution to Entrepreneurs

Venture Capital Investments and Its Contribution to Entrepreneurs

Venture Capital is a finance that is usually given to start-up companies that have a high potential growth, but are still too small to raise enough money on their own. There are many venture capital companies available, and will invest depending on how much potential the VC’s think your company has, and also what stage it is in. Venture Capitalists only want to invest in a firm if they believe it has a chance of attracting customers and eventually able to make money. The advantage of having venture funding is that you do not need to take out a bank loan for start-up costs and then stress about having to pay back the loan payments to the bank if your growth is slow at first. Ventures look for return on investment in the long-term and also share the risk with you. If your business is unsuccessful or has a difficult time making money, then you do not have an obligation to pay back the venture.

It is relatively easy to think of a great business idea, such as a unique product or service, but being able to turn that idea into a profitable business requires some external help. One of the best ways to get your business ideas funded is to approach a venture capital firm, but before doing this, it is necessary to prepare a proposal that outlines what your idea is, projected target market, projected return on investment, and most importantly, why the ventures should invest in your idea.

The entrepreneurs of these start-ups have tremendous ideas, but all they are lacking is the knowledge and funding, which is why it is essential to have the support of business professionals who understand the challenges associated with financial growth. By having a venture capitalist, these entrepreneurs also have a better chance for their start-up to go into high growth stages down the road, such as an initial public offering (IPO) registration. In order to do this, it is important for the start-up to have proper auditing, workforce development, and even legal issues taken care of. Ventures have connections with all of these business aspects that will help the entrepreneur and allow the growth of the company to happen smoother, but also faster.

Angel investors are venture capitalists who are usually retired and are very wealthy since they use their personal funds rather than pooling their money with other investment firms. Angels like to invest in start-up businesses that are usually in the early stages of their growth. These are companies that have a product or service idea, but yet to really have any proven customers or an established workforce. Angels invest money in return for part ownership of the start-up, such as stocks or bonds, and with this ownership, the Angels are able to help get the start-up off and running. Angel investors evaluate your business similar to a venture capitalist. Overall, it is a risk for venture capitals to invest in many of these start-up businesses, … READ MORE ...

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