Types of Trading
CNC is used for buying equity shares in delivery. So while buying shares in delivery the client requires complete margin of the shares eg-If a client wants to buy 100 shares of Reliance for delivery and the current market price of Reliance is 1000 then client requires 1000*100 i.e 100000rs to do this transaction.
Intraday
Intraday trading involves buying and selling of stocks within the same trading day. Here stocks are purchased, not with an intention to invest, but for the purpose of earning profits by harnessing the movement of stock indices. Thus, the fluctuations in the prices of the stocks are harnessed to earn profits from the trading of stocks.
Types of Intraday Trading:
MIS – Marginal Intraday Square-off
As the name suggests, it is an intraday order that gets squared off the same day; but lets you transact with low margin in cash, futures and currencies futures.
CO – Cover Order
A Cover Order is a special type of order through which the user can take an intra-day position and take advantage of extra exposure while being protected through a stop loss order. Here is how it works. The system will place two orders simultaneously: a market order and a corresponding stop loss market order which would only get triggered at the specified stop loss trigger price. If the trigger price is hit, the stop loss order gets executed as a market order. The combination of both these orders being placed simultaneously is known as a Cover Order. Cover Orders help you limit any potential losses that could be incurred on a position.
How Cover Orders Work:
• A Cover Order is basically a two legged order. The client needs to place a buy/sell order with compulsory corresponding stop loss order in the opposite direction.
• The first entry order will always be a market order.
• The corresponding stop loss order will sit in the order book as a Stop-Loss trigger pending order; once the trigger price hits the stop loss limit price, it gets triggered as a market order.
• The trigger price range will be defined daily and the client must place the stop loss order within the specified range. For example, suppose Reliance Industries is trading at Rs. 900 and the range is specified as 10%. In this case the client can specify the Stop Loss order between the price ranges of Rs.810 to 990 as the trigger price.
BO – Bracket Order
Bracket orders are designed to help limit your loss and lock in a profit by "bracketing" an order with two opposite-side orders. A BUY order is bracketed by a high-side sell limit order and a low-side sell stop order. A SELL order is bracketed by a high-side buy stop order and a low side buys limit order.
The order quantity for the high and low side bracket orders matches the original order quantity. By default, the bracket order is offset from the current price by 1.0. This offset amount can be changed on the order line for a specific order, or modified at the default level for an instrument, contract or strategy using the Order Presets feature in Global Configuration
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