What is BTST (Buy Today, Sell Tomorrow) Trading
The stock market is a place where many peoples are investing their money in order to take profit. There are a number of different strategies by which investors can earn profit, BTST is one of those strategy by which investors can manage their portfolio.
BTST stands for (Buy Today, Sell Tomorrow), BTST trades are those where traders can take advantage of short-term volatility by buying today and selling tomorrow. Traders can buy/sell any stock by using CNC order, this transaction is complete in T+2 days where T is the day of trading, so if you buy some shares of a company on Monday, the shares will be credited on your demat account on Wednesday. If there is any holiday in between then delivery period is extended.
How to place BTST order?
In order to place the BTST trade you need to use the CNC (Cash and Carry) product type in BSE and NSE. For example, if you want to buy shares of a company and sell it after a few days, you should use the CNC as the product type.
Key Features of BTST
1. In BTST, trader can sell the stock immediately the next day before the stock is credited in your demat account.
2. This trading feature is not provided by all brokers, there are some brokers who allow BTST trading.
3. T2T (Trade to Trade Segment) is not permitted to carry out BTST as in T2T is compulsory to take the delivery of the stocks to carry out any other transactions.
4. T2T (Trade to Trade Segment) is not permitted to carry out BTST order.
Merits of BTST Trading
1. Traders can earn good profit in delivery trades as comparison to the short-term trades with high volatility.
2. BTST trades do not include Demat Debit Transaction Charges as shares are not credited in your demat account.
3. In BTST you have two more days to manage your portfolio.
4. BTST helps trader to improve the portfolio.
5. You have the choice to sell the shares on same day or next day.
Demerits of BTST Trading
1. BTST trading facility is not provided by all brokers and trader has to pay the full amount as the orders are cash & carry orders.
2. In BTST trading you need to have sufficient higher margin as comparison to the intraday trades.
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