Day trading doesn’t allow in Bangladesh Stock Market. Day trading is a type of trading method. By this method, traders close trade within trading hours. They don’t hold position for next day.
Bangladesh Stock Market didn’t permit day trading because of many reasons. Day trading has both merits and demerits. Perhaps, Bangladesh Security and Exchange Commission wants to control the chaos of the market. Day traders’ involvement volatile the market.
So, traders and investors face huge risk to lose money. Moreover, concern authorities need to develop sophisticated technology in order to create a day trading platform. Therefore, Bangladesh Share Market didn’t see the light of day trading yet. Let’s learn some merits and demerits of day trading.
Advantages and Disadvantages of day trading
1. Advantage: Day traders close trade within trading hours. Therefore, they have no risk to hold position overnight.
#1. Related Disadvantage: Swing trading is better than day trading because it helps to capture the maximum profit in many cases. Moreover, day trading needs day trading strategies, skill and experience. So, there are many good reasons why you should avoid day trading.
2. Advantage: In some cases, return on investment is high in day trading because it aids to compound capital more frequently.
#2. Related Disadvantage: Frequently trading is costly because of high commission rate. Moreover, frequent trades may responsible for trading mistakes.
3. Advantage: Day trading requires relatively less time to make more profit.
#3. Related Disadvantage: If a day trader commits trading mistakes and fails to use stop loss earlies, he will definitely lose huge capital.
At present, implementing day trading platform is a herculean task for Bangladesh. Day trading needs high technology-based stock exchange. Recently, Dhaka Stock Exchange has been working to improve technology. In near future, concern authority may implement day trading in Bangladesh Share Market.