# How to take daily profit in trading? – How to earn Rs 1000 in share market on daily basis?

**How much profit the trader can make in a month?
**

If traders follow a simple strategy called “Take small profits and do multiple trades” which is explained in following subsection then trader can easily earn Rs 1000 To Rs 2000 per day.

**Take small profits and do multiple trades**

The successful strategy for day trading is to “take small profits and do multiple trades”.

Basically it has been observed that many times traders lose money due lack of knowledge. For example – Suppose if day trader’s buying price is at Rs.200 per share then he waits for the price to go till Rs.204 or Rs.205 and then he will plan to book profit, which is highly impossible on very frequent basis in single trade.

If you are expecting Rs.4 to Rs.5 as profit on share price of Rs.200 in single move then you are expecting 2% profit in single trade. So do you think it is convincing you? Our analysis says this doesn’t sound practical and this is the reason why traders lose money after waiting for long time.

Your intention is to earn money in a day, so just concentrate on small profits and do multiple trades instead of waiting to get huge profit in just single trade.

Markets are always right so to avoid the further risk it is always recommended that day traders should keep booking profit wherever applicable.

So please have a look on following example about taking small profits and doing multiple trades and how it will provide Rs 1000 to Rs 2000 profit per day and at the end of the month you will be able to earn good amount.

The current intraday brokerage offered by us Rs 20 for buying and Rs 20 for selling. For opening the account you can visit the online trading account opening guide.

**Example – How to trade and earn profit on daily basis**

Suppose if trader bought Buy Tata motors at Rs.320, quantity – 500

Total cost will become Rs.320 x 500 = Rs. 160000.

So if you have Rs.40, 000 in your trading account you can do day trading using margin amount from broker. Margin amount is amount given by your broker for day trading. This amount varies from broker to broker but it is generally 4 to 5 times and it is also based on stock you choose for trading.

Now you sold Tata motors at Rs.321.5, Qty – 500 . Here you can see trader took profit of Rs 1.5.

The total amount comes to Rs 321.5 x 500 = 160750.

Your gross profit is Rs 750.( Rs 1.5 x 500) .

**Let’s see how to calculate brokerage and taxes:-**

The service tax is of 15% only on brokerage.

– The STT (Security Transaction Tax) is of 0.025% only selling amount.

– The stamp duty on total turnover for a day which is 0.002%.

– and finally SEBI Turnover tax – 0.0002% on turnover

Don’t worry all these taxes will add up to very small amount at the end of the day compared to your profits in thousands.

Now let’s see how to take small profit which will add up to big amount at the end of the day or by month by doing multiple trades.

**Your buying amount is**

= Rs. 160000 (Rs.320×500 Qty shares)

= Rs 20 for buying as brokerage

= You have to pay service tax of 15% only on brokerage.

= so 15% on Rs.20 comes to Rs 3

**The total brokerage + service tax on buying is Rs.20 + Rs.3 = Rs.23
**

Now let’s calculate the brokerage and taxes on selling amount

= you sold Tata motors at Rs.321.5, Qty – 500 so the amount comes to Rs. 160750

= Rs 20 for Selling as brokerage

= You have to pay service tax of 15% only on brokerage.

= so 15% on Rs.20 comes to Rs 3

= You have to pay STT (Service Transaction Tax) of 0.025% on selling amount which comes to Rs.40.18

**So total brokerage + taxes you have to pay for selling is
**= Rs.20 + Rs.3 + Rs.40.18

= Rs.63.18

**Total amount you have to pay on buying and selling trade is = Rs.23 (buying) + Rs.63.18 (selling) = Rs.86.18**

You also have to pay stamp duty and regulatory charges on total turnover.Your total turnover is calculated by adding the buying amount and selling amount.

Buying amount is 160000 and selling amount is 160750 which adds up to Rs. 320750

Stamp duty – 0.002% and SEBI turnover tax – 0.0002% and both adds up to 0.0022%

On total turnover amount (Rs. 320750) the taxes comes to Rs 7.05

So the total amount you have to pay including brokerage and taxes is only Rs.86.18+ 7.05 = 93.23

So now the conclusion is you are paying Rs. 93.23 while you earned Gross profit of Rs.750. So you net profit comes to Rs 750- Rs 93.23 = Rs 656.77

If you continue doing such small trades with such small profits then it will end up with big amount at the end of the day.

Suppose if you do 2 trades in a day then your net profit will be Rs 656.77 x2 = Rs 1313.54

**Conclusion – Taking only Rs 1.5 profit for Rs 300 share is quite easy.**

**How to increase profits?**

In above example we have bought only 500 shares and If you increase the number of shares then your profit will increase accordingly. Try to take small profits because there are lots of changes for small price fluctuations.

So if you trader 1000 shares and your profit will be doubled per day and that comes to Rs 1313.54×2 = 2627

**Monthly profits –
**Your daily profits have come to Rs 2627. In a month there are 22 trading days. So your profits becomes Rs 2627 x 22 = Rs 57595.

We also believe that it is not possible to earn profit on daily basis and also some losses would happen due to market fluctuations. So we will take only 50% profit from above amount so from Rs 57595, it comes to Rs 28897.

So believe in small and end up the day and your month with big profits.

**Important note –**

1) Only profits are not possible in day trading, losses are also part of day trading. If your trade goes wrong then trader has to accept losses and come out of trade. Even if you lose 50% profit then also you are getting 50% returns.

**2) Trading on Margin Amount
**Margin amount is the extra amount given by the broker to trade for a day.

Margin amount varies from broker to broker but generally broker provides 4 to 5 times margin amount.

**Big Disadvantage of Margin amount – **If you use the margin amount then you have to square off your trades before market closes whether you are in profit or loss.

So if margin amount is not used and if your trade goes wrong then you can take delivery of those stocks and sell later whenever price goes up.

**New comers to day trading**

New comes to share market can start trading by small amount like Rs 5000 or 10,000 and get confidence of earning and once the trader makes consistent profits then he can plan to increase the amount.

The conclusion is forgetting the “Greed Factor and Taking Small Profits” will make miracle to your Trading profits.

**So believe in small and end up the month with big profits.**