A stock market is a place where you an investor come with a lot of desires. Generally, these expectations are rational but when the time comes to actually execute this goal investors get stuck with technical terms and questions.
One of these questions is “Can I sell delivery shares on the same day?” and the other consideration along with this action.
In this article, we will talk in-depth about this question and other related stuff like the reason for the same, what is the trade and trade segment? etc.
1. Can I sell delivery shares on the same day?
The straightforward answer is Yes, you can sell delivery shares on the same day.
But this transaction will be considered as an intraday transaction and the charges will be charged accordingly.
The process will be covered later in the article, but you can just convert the position of your trade from delivery to intraday and later, on the same day sell the holding at your desired price.
You can not do intraday trade in the trade and trade segment. Under this segment, you have to compulsory need to take delivery under the t+2 settlement cycle.
2. Reason for selling delivery shares on the same day
a. Bad news
After you purchase the shares there is bad news about the company and the shares price tumbles. In such a case you probably would want to sell your holding and get back your money.
b. Change in fundamentals
This happens when there is a major change in the fundamental of the company like the plastic ban, free internet by a competitor, launch of a cheaper product by the competitor firm, etc.
c. Target hit
Traders usually buy in a stock which a target price on it. If this price hits on the same day you will likely want to sell your position and book profits from the same.
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3. Step by Step Process of selling delivery shares on the same day.
- Open your Zerodha kit or website.
- Select the holding you want to sell and then click on the three dots beside it.
- Click on the convert after clicking on the three dots.
- Then press the Exit option.
4. Charges for selling delivery shares on the same day.
There are no extra charges for selling delivery shares on the same day.
You will be charged as per intraday transaction, as selling delivery shares on the same day will be considered as an intraday transaction.
Do check intraday charges with your respective brokers like Zerodha, Uptox, 5pasia, etc. in most cases it will be flat Rs. 20 or 0.03% (whichever is lower) per executed order on intraday trades.
5. Selling stock from the portfolio and buying them again on the same day, impact the average cost.
When you buy stock and sell them on the same day it will not affect the purchase price of the shares already present in your portfolio i.e.Demat account.
All the intraday transactions will be considered differently in your trading account as the shares have not physically moved in and out of your Demat account.
a. Detail Example.
If you own 100 shares of Wipro Ltd. at the price of ₹400 a share in your portfolio a few years back.
Now consider you bought 10 shares at 640 apiece and sold the position on the same day as your set target has been reached at 650 apiece. This transaction will not affect the buy price of the holding in your portfolio of 100 shares of ₹400 each.
Related article: How to sell t+1 holding in Zerodha?
6. Not allowed in trade to trade segment (t2t).
Buying shares on delivery trade and selling them on the same day will be considered an intraday transaction. Intraday transaction in the trade to trade segment is not allowed.
You have to take the delivery under the t+2 settlement cycle under the t2t segment before selling the holding. A list of stocks cover under the t2t segment is available on NSE and BSE websites which are changed regularly.
So you can sell delivery shares on the same day without extra charges by using the option of ‘convert’ available with your respective broker.
Also, this transaction will be considered as an intraday trade so all the charges will be levied accordingly.
Sell the delivery shares in the same-day option is not available in trade to trade segment, a list of shares covered under t2t segment is available on stock exchanges websites