Tips for How to Earn Minimum 30% Profit in One Month

How much profit you will make in a month? Will you believe, if we say 30%?

If you follow a simple strategy which is called as “Take small profits and do multiple trades” which is explained in following example

Let’s see the following example

Please note - Currently our intraday brokerage charges are 0.03% for buying and 0.03% for selling,

Taxes to pay for intraday trading :

1. The Service tax is 10.36% only on brokerage.(Update Mar 09- The service tax is reduced to 10.30% including education cess )
2. The STT (Security Transaction Tax) is 0.025% only on selling amount.
3. The Stamp duty on total turnover for a day which is 0.002%.
4. and finally you have to pay Regulatory charges on total turnover for a day which is 0.004%

No need to worry about these taxes as all these taxes will add up to very small amount at the end of the day compared to intraday profits.

Example -

Suppose you have bought the shares of Bharati Airtel at Rs.315 and quantity 100 so the total amount you have to pay is Rs.315 x 100 = Rs.31,500.

Let’s see how to calculate the brokerage and taxes.

Your buying amount is
Rs.31500 (Rs.315x100 Qty shares)

Brokerage charges
0.03% as brokerage (It’s our brokerage rates) on 31,500 comes to Rs.9.45

Service Tax
The service tax is 10.36% only on brokerage amount, so 10.36 % on Rs.9.45 comes to Rs 0.98.

Total charges you have to pay on buying amount is :

The total brokerage + service tax which come to Rs.9.45 + Rs.0.98 = Rs.10.43

Now let’s calculate the Brokerage and Taxes on selling amount :

Your selling amount
Suppose you sold Bharati Airtel shares at Rs.316 (you took profit of only Rs 1), Qty - 100 so the amount comes to Rs.31,600 (Rs.316 x 100 Qty shares). Your profit is Rs 100.

Brokerage charge
0.03% brokerage on 31,600, comes to Rs.9.48

Service Tax
The service tax is 10.36% only on brokerage amount, so 10.36 % on Rs.9.48 comes to Rs 0.99.

STT (Service Transaction Tax) is only on selling amount
The STT (Service Transaction Tax) is 0.025% on selling amount (the selling amount is 31,600) which comes to Rs.6.32.

Total charges you have to pay on selling amount is = Brokerage + service tax + STT
= Rs.9.48 + Rs.0.99 + Rs.6.32
= Rs.16.79

Total amount you have to pay on buying and selling is (including Brokerage and taxes) :

= Rs.10.43 (buying) + Rs.16.79 (selling)
= Rs.27.22

Also you have to pay stamp duty and regulatory charges on total turnover:

Rate - The stamp duty on total turnover for a day is 0.002% and Regulatory charges are 0.004%.

Stamp duty and regulatory charges are applied on total turnover of a day.

The total turn over is calculated by adding the buying and selling amount happened through out the day.

In above example the Buying amount is 31500 and selling amount is 31600 which adds up to Rs. 61300

Stamp duty is 0.002% and Regulatory charges are 0.004% which adds up to 0.006%

So on total turnover amount of Rs. 61300 and the stamp duty and regulatory charges on that comes to Rs 3.8.

So the total amount you have to pay for the trade of buying 100 shares of Bharati Airtel at Rs 315 and selling them at Rs 316 comes to = Rs 27.22 + 3.8 (stamp and regulatory charges) = 31.02 which includes brokerage rates and various taxes

Conclusion :

So now the conclusion is you paid Rs.31.02 (brokerage and taxes) while you earned the profit of Rs.100.
So your Net profit is Rs 69 [Rs 100 - Rs 31 (brokerage and taxes) ]

So don’t you think 69% profit in single trade is quite enough to do thousands per day?

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

Let’s see how it will add up to thousands :

Suppose if you do only 10 trades in a day by taking only Rs 1 as profit then it will add
up to Rs 690 (Rs 69 x 10 trades in a day).
Please note - One rupee movement in share price of Rs 300 happens very easily and for many times in a day.
So if possible select higher prices share for day trading so that you can take small profits and do multiple trades.

How to make thousands in a day? :

Now let’s see how to do thousands with same strategy as mentioned above.

Its simple, you just have to increase your quantity of shares.

In above example you have bought only 100 quantities, if you just make it double then your profit will also get doubled.

How much will you make in a month?

Rs.69 per trade as net profit (as per above example).
10 trades per day (how much trades are possible, you will come to know by doing paper trading practice, which we already explained in day trading section, and according to our analysis 10 trades in a day are very easily possible)
Total Rs.69x10 trades = Rs.690 per day.
Total approximate 20 trading days in a month.

So Rs.690x20 = Rs.13,800.
Please note - You can also do 5 trades in a day and earn good amount in a day and adding it with thousands at the end of the month.

Let’s consider some losses while trading :

Trading without losses is not possible for any trader, but trader has to reduce the losses and maximize the profits.
(Please visit our different day trading sections to read about reducing the losses in day trading)

Now let’s suppose you made loss on some days or due to some reason you are not able to trade on some days, so let’s consider 5 days as compensation as loss in a month.
So 5 days losses comes to Rs 3450 (Rs 690 per day x 5 days).

So the compensation for losses for 5 days in a month comes to is Rs.3450.

Final Total Net Profit
You are making profit of Rs 10350 (Rs13,800 - 3450) profit per month.

Your investment is Rs 35,000 and you are getting profit of Rs 10,350 per month so in just 3 to 4 months you are making your money double.

Trading on Margin Amount :

In the above example the margin amount is not used but only the investment amount Rs 35000 is used.

Margin amount is the extra amount given by the broker to trade for a day.
Margin amount varies from broker to broker but generally they provide 3 to 4 times.

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 you have to square off your trades before market closes or else heavy penalty will apply.

Important Precaution - In margin amount the risk is very high. You have to square off your trades on same day.
We generally advice to not to use margin amount for new comers to trading.

If you dont use margin amount then you can hold your positions for next day or as long as you want because you are using your own money and not broker's money (margin amount).

New comers to day trading :

You can invest small amount like Rs 5000 or 10,000 and earn profits in a month and once you gain experience then you can invest big amount.

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