Hi All,
Can anybody clear my doubt on this?
Ex.
I hold 20 quantity of XYZ stock in my DMAT account and current margin is 0 Rs.
As I see the stock price is falling, Can I short sell these 20 shares and buy back by end of the day?
Will I get any profit Selling in High price and buying back in Low price?
I am new to trading. This may be a stupid question. Expecting answers from experienced traders.
Thank You.
You can earn profit by doing Intraday, but keep in mind this trades will be counted as Intraday and there will be no change in average price of your holdings since no credits or debits happened from your Demat account.
When you place a sell order in CNC , the The RMS (Risk Management System) will first check your demat to see if the shares you are trying to sell are available in your demat. If it does not find the shares , it will reject the order.
You can short sell and close the Positions for Intraday in CNC only if you hold the dame shares in your demat.
CNC : CNC is cash & carry you should use this order type when you wanna take delivery of particular stock or carry you position overnight . In CNC you need to pay full amount of your stock price. you should not able use margin in that case. CNC Shorting:- you sell only for your holding share, you already own.
MIS: MIS is Margin intraday square off. you can use MIS order type when you tack intraday position. In MIS your order will remain activated till that particular day. the biggest advantage of MIS product type because of its margin. when you choose MIS as a product type and buying a any particular stock then you not need pay full amount of that stock. you should only need to pay small amount. MIS shorting :- It can be that risky make you buy stock at any price to close your position for the day.
NRML: NRML is Normal Order .This order type is particularly used in future market or future contract. you should use NRML order type when you buy or sell a future contract and wanna carry around overnight or until expiry of that contract. Is working same like a taking delivery of stock but you hold maximum till the expiry of that contract.
CNC Shorting : You sell the number of shares you already own.
MIS shorting : Risky ,it can be that risky and make you buy stocks at any price to close your position. Fees and charges are huge.
NRML : It is a delivery based product giving flexibility to pay the remaining amount not later than 5 days from the exchange payout day. It is most suitable for short term investors. MIS product type is if you need additional leverage for intraday trade, otherwise always trade using NRML.
Thanks Shubh for your reply.