How to pick the right stocks for Intraday Trades
How to pick the right stocks for Intraday Trades

1. Choose highly liquid stocks

When a stock is highly liquid, you can buy and sell it at any point without affecting the prices too much. These stocks have much higher volumes too, which means there’s higher demand and supply for the stock. But, do ensure that the stock is liquid at different price levels.

To decide whether to invest from a long or short position, you can analyze the 52-week high and low values of a stock.

2. Go for medium to high volatility

Volatility is the rate at which a stock price rises or falls. You can make a profit when the stock price moves according to your expectations.

Stocks with medium to high volatility are mostly preferable. But, do avoid stocks with fluctuations of more than 3% to reduce any unexpected losses

3. Find correlated stocks

A simple way to start intraday trading is to find stocks that are highly correlated to a sector or an index.

The market trend you’ll see in the sector or the index will give you a fair understanding of the performance of the correlated stocks as well. This primarily means that if the sector or index moves upward, the stock’s price will increase.