Intraday vs Delivery Trading: How They Differ in Costs and Risks
Published 2026-10-16 · Aadarna Stock Broking Pvt. Ltd.
Key takeaways
- A delivery trade means you buy shares and take them into your demat account to hold.
- An intraday trade is bought and sold on the same day; open positions may be squared off automatically.
- Intraday trading involves margin, frequent transactions and fast price moves, which make losses more likely.
- Charges and taxes differ between the two; read your contract note to see the real cost.
When you place a buy order in a trading app, you usually choose a product type: delivery (often called CNC) or intraday (often called MIS). The choice changes how the trade is settled, what it costs and how much risk you take. This guide explains the difference. It does not suggest any strategy.
Delivery trades
In a delivery trade, you pay the full value of the shares and they are credited to your demat account after settlement. You can hold them for as long as you like, and you receive dividends and other corporate benefits while you own them.
Long-term investors use delivery trades. The main risk is the normal market risk of the company and the market.
Intraday trades
In an intraday trade, you buy and sell (or sell and buy back) the same shares on the same trading day. The shares never reach your demat account.
Brokers usually allow intraday positions with margin, meaning you can take a position larger than the cash you put in, within limits set by exchange rules. If you do not close the position yourself before the broker's cut-off time, it is squared off automatically, and the broker may charge a fee for that.
Why intraday is riskier
- Leverage magnifies losses. A small price move against you can mean a large loss compared with the cash you put in.
- Short time frame. You have only hours for a trade to work, and prices can move sharply on news.
- Costs add up. Frequent buying and selling means paying charges and taxes again and again, which eats into any gains.
- Emotional pressure. Watching prices minute by minute makes rushed decisions more likely.
Studies of individual traders by SEBI have found that most frequent traders in derivatives lose money, and similar pressures apply to intraday trading in shares. Treat intraday trading as high risk.
How costs differ
Brokerage, exchange charges, Securities Transaction Tax (STT), stamp duty and GST apply differently to intraday and delivery trades. The rates are set by your broker's tariff and by the government and exchanges, and they change from time to time.
The easiest way to see the real cost of any trade is your contract note, which lists every charge. Comparing the total charges with your profit or loss for a month is often an eye-opener.
Questions to ask before trading intraday
- Can I afford to lose the money I am trading with, including losses larger than I expect?
- Do I understand margin requirements and what happens at auto square-off?
- Have I calculated the charges on a typical trade?
- Am I acting on my own understanding, or on tips from someone who is not registered to give advice?
Converting between the two
Some apps let you convert an intraday position to delivery during the day if you have enough funds to pay the full value. Rules vary by broker and by share, so check your broker's help pages before relying on this.
Frequently asked questions
Do intraday trades show in my demat account?
No. Because they are closed on the same day, the shares are never delivered to your demat account.
What happens if I forget to close an intraday position?
The broker squares it off automatically near the end of the trading session, at the market price at that time, and may charge an extra fee for doing so.
Does delivery trading carry no risk?
No. Share prices can fall, and you can lose money on delivery trades too. The risk is simply different from the leveraged, short-term risk of intraday trading.
Sources
- SEBI – Analysis of intraday trading by individuals in the equity cash segment (July 2024)
- SEBI – research studies, including the January 2023 study of individual traders' profit and loss in equity F&O
- Angel One – brokerage, transaction and government charges
Risk disclosures on derivatives
- 9 out of 10 individual traders in equity Futures and Options Segment, incurred net losses.
- On an average, loss makers registered net trading loss close to ₹50,000.
- Over and above the net trading losses incurred, loss makers expended an additional 28% of net trading losses as transaction costs.
- Those making net trading profits, incurred between 15% to 50% of such profits as transaction cost.
Source: SEBI study dated January 25, 2023 on "Analysis of Profit and Loss of Individual Traders dealing in equity Futures and Options (F&O) Segment", wherein Aggregate Level findings are based on annual Profit/Loss incurred by individual traders in equity F&O during FY 2021-22.