Stock Market · Introduction to Stock Markets

Intraday vs delivery

When you buy a stock, you decide immediately: keeping it overnight or selling today?

Delivery (CNC)

Buy → shares go to your demat after T+1. Hold days, months, years. No leverage. You pay the full price. Lower risk. Long-term wealth building happens here.

Tax: held over 1 year = LTCG (Long-Term Capital Gains), taxed at 12.5% above ₹1.25 lakh profit. Held under 1 year = STCG (Short-Term Capital Gains), taxed at 20%.

Intraday (MIS)

Buy and sell (or sell then buy) the same stock the same day. Position must close by 3:20 PM. Broker auto-squares off anything remaining, usually at a poor price.

Brokers offer leverage on intraday. You might need only 20% of the trade value upfront. That amplifies gains and losses by 5×.

> Reliance moves 2% on a delivery trade: you make 2%.

> Same 2% on intraday with 5× leverage: you make 10%.

> But a 2% move against you with 5× leverage: you lose 10% of capital, in one day.

The rule for beginners

Delivery only, until you understand how stocks move across different market conditions. Intraday is an advanced mode. SEBI's own data shows 70–80% of retail intraday traders lose money.

Build conviction first. Add leverage later.

[compare:Delivery (CNC)=Own the share, hold any duration, full payment|Intraday (MIS)=Close by 3:20 PM, leverage 5x, 70-80% lose money]

70–80%Retail intraday traders who lose money (SEBI study)

20%Typical margin required for intraday (broker-dependent)

Takeaway. Delivery builds wealth slowly and safely. Intraday amplifies everything. Including losses. Start with delivery.