Which Are the Best BTST Stocks to Trade Today and Tomorrow?
Hi Traders,
BTST stands for Buy Today Sell Tomorrow, a trading strategy that gains popularity among those seeking to make quick profits by holding positions overnight. Unlike intraday trading, where all transactions are completed within the same trading day, BTST allows traders to hold onto their positions until the next trading day, giving them the flexibility to take advantage of after-hours news, earnings announcements, or global market movements that may positively impact a stock's opening price the following day.
Understanding BTST and Its Benefits
BTST positions are particularly popular among traders who monitor technical indicators and market sentiment, looking for stocks with signs of upward momentum. This trading style offers a distinct advantage by bypassing the typical settlement period for stock delivery, allowing traders to sell before receiving the stock in their demat account. However, this approach comes with a level of risk since any unexpected negative news or global events can lead to price drops, impacting the next day's opening price. Effective BTST strategies often involve a combination of technical analysis, news monitoring, and strict risk management, making it crucial for traders to be aware of both potential rewards and risks in this fast-paced trading style.
Identifying Suitable Stocks for BTST
When a stock or index breaks out of a range near the closing of the market, it gets qualified for BTST or STBT (Sell Today Buy Tomorrow). These calls carry inherent risks, as markets can open against your views. Therefore, it is advisable to go with a stop-loss for any BTST or STBT trades carried overnight. Whether BTST trading is profitable largely depends on using an effective, well-researched strategy and having market momentum on your side.
Real-World Example: A Successful BTST Strategy
I recently made a profit of Rs. 21,750 on Biocon NOVFUT when I purchased the stock at Rs. 320 and sold it the next day at Rs. 328.70, guided by insights from my SEBI registered research partner, EQWires Research Analyst. This experience demonstrates how BTST can help capture quick gains with the right guidance. By focusing on high liquidity, following news, and checking technicals, traders can optimize their overnight positions, thereby minimizing risks.
Tips for Effective BTST Trading in India
Focus on Liquidity: Choose stocks with high volumes to minimize slippage. Follow News: Any positive or negative news can lead to significant movement by the next trading day. Check Technicals: Look for bullish patterns and indicators such as MACD, RSI, and moving average crossovers. Stay Updated: Markets can react to global events overnight, impacting BTST trades. Have a Stop-Loss Strategy: Always have a stop-loss in place to manage risk as overnight news or global factors can lead to unexpected moves at market open.Conclusion
BTST trading can be a profitable strategy when used with a well-researched approach and favorable market conditions. It offers traders an opportunity to capture quick gains by holding positions overnight and benefiting from anticipated price movements at the next day’s open. For those who cannot monitor live markets throughout the day, BTST/STBT services provide a structured way to leverage overnight trends without continuous market tracking. With the guidance of a reliable research analyst and a disciplined strategy, BTST can be a valuable tool for traders looking to make focused short-term profits.
I hope you found this article helpful. Please share your feedback and let me know if you have any more questions or need further assistance.