What is Intraday?
Intraday refers to trading activities that occur within one trading day. In finance, the term is used for securities such as stocks and exchange-traded funds (ETFs) that are traded during daily business hours. The essence of intraday trading lies in making profits from the price movements within the same trading day. Intraday price movements are pivotal for short-term traders, especially day traders, who settle their positions by the market’s close.
Key Takeaways
- Intraday trading focuses on the price movements of securities within a single business day.
- Day traders capitalize on these movements by executing multiple trades to benefit from short-term price changes.
- Common intraday trading strategies include scalping, range trading, and news-based trading.
The Basics of Intraday Trading
Intraday trading examines the high and low price points that a security reaches during a trading session. For instance, a
Related Terms: scalping, range trading, VWAP, algorithms, net asset value.
References
- Robinhood. “What is Intraday?”
- Yahoo Finance. “Apple Inc. (AAPL)-Historical Data”.
Get ready to put your knowledge to the test with this intriguing quiz!
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## What is the main objective of intraday trading?
- [ ] Investing for the long term
- [ ] Seeking dividends and interest income
- [x] Buying and selling securities within the same day
- [ ] Accumulating assets over time
## Which type of analysis is most often used for intraday trading?
- [ ] Fundamental analysis
- [x] Technical analysis
- [ ] Ratio analysis
- [ ] Long-term market prognostication
## Which financial instrument is commonly associated with intraday trading?
- [ ] Real estate properties
- [x] Stocks and options
- [ ] Treasury bonds
- [ ] Retirement funds
## How do intraday traders typically make profits?
- [ ] By holding long-term positions
- [ ] Through dividend payments
- [x] Capitalizing on short-term price movements
- [ ] Collecting rental income
## What is a significant risk factor in intraday trading?
- [ ] Liquidity risk
- [x] Market volatility
- [ ] Real estate market dips
- [ ] Fixed interest rate changes
## What is a stop-loss order used for in intraday trading?
- [x] To limit potential losses on a trade
- [ ] To maximize the gains of a trade
- [ ] To calculate the dividend earnings
- [ ] To plan long-term investment goals
## Which time frame is commonly used in intraday trading charts?
- [ ] Annual charts
- [ ] Monthly charts
- [ ] Weekly charts
- [x] Minute-by-minute charts
## Which of the following strategies is least likely employed by intraday traders?
- [ ] Scalping
- [ ] Momentum trading
- [ ] Swing trading
- [x] Buy-and-hold
## What must intraday traders closely monitor for making decisions?
- [x] Real-time market data
- [ ] Annual reports
- [ ] Long-term economic forecasts
- [ ] Retirement account balances
## What type of account is typically required for frequent intraday trading?
- [ ] Checking account
- [ ] Savings account
- [ ] Trust account
- [x] Margin account
