Intraday trading refers to opening and closing a position in a stock in the same trading day. This can be buying and selling to capitalize on a potential rise in a stocks value or shorting and covering the short to capitalize on a potential drop in value.
Most brokers allow clients to take an initial position in a stock that is 5 times the value of their account , but some brokers give more leverage (i.e. 20X). For example, a person with 10,000 in his/her account can take a 50,000 position in a stock for day trading purposes. Usually this amount is not allowed to be held overnight.
If you are using only the money in your account and close your positions the same day it constitutes intraday trade.
If you use your brokers leverage money along with your account money to trade and then close position the same day it becomes a intraday margin trade.
Most brokers allow clients to take an initial position in a stock that is 5 times the value of their account , but some brokers give more leverage (i.e. 20X). For example, a person with 10,000 in his/her account can take a 50,000 position in a stock for day trading purposes. Usually this amount is not allowed to be held overnight.
If you are using only the money in your account and close your positions the same day it constitutes intraday trade.
If you use your brokers leverage money along with your account money to trade and then close position the same day it becomes a intraday margin trade.
