Intraday vs delivery trading
Updated 11 October 2026
Brokerage and charges calculator →
When you buy shares in India, your trading app asks you to pick a product type. That choice decides whether the trade must be closed the same day, how much money is blocked, and how the profit is taxed. The two broad styles are intraday trading and delivery trading.
The product codes
- MIS (Margin Intraday Square-off): for intraday trades in equity or F&O. The position must be closed the same day. If you do not close it, the broker closes it for you.
- CNC (Cash and Carry): for delivery in the cash market. You pay the full value and the shares come into your demat account. You can hold them as long as you like.
- NRML (Normal): for carrying futures and options positions overnight, up to expiry, with full F&O margin.
Names can differ slightly between platforms, but these three are the usual labels.
Auto square-off
The NSE and BSE equity session runs from 9:15 am to 3:30 pm. Brokers automatically close open MIS positions some time before the close, commonly in the last 10 to 20 minutes. The exact time varies by broker and by segment, and many brokers charge a fee for auto square-off. Check your broker's timings rather than assuming.
Leverage and SEBI peak margin rules
Intraday trades need less money upfront than delivery, but the limit is set by SEBI's margin framework, not by the broker's generosity. Since the peak margin rules were phased in (fully from September 2021), brokers must collect the required margin, usually VaR plus extreme loss margin, at all times during the day, including at intraday peaks. For equity cash trades this works out to at least 20% of the trade value, so intraday leverage on stocks is capped at about 5 times, and lower for more volatile stocks.
Worked example
You buy 100 shares of Stock ABC at ₹500. Trade value = 100 × ₹500 = ₹50,000. Assume the exchange margin for this stock is 20%.
| Intraday (MIS) | Delivery (CNC) | |
|---|---|---|
| Money blocked | ₹50,000 × 20% = ₹10,000 | ₹50,000 |
| Price moves ₹5 against you | Loss ₹500 | Loss ₹500 |
| Loss as % of money blocked | ₹500 ÷ ₹10,000 = 5% | ₹500 ÷ ₹50,000 = 1% |
The rupee loss is the same. Leverage only changes how large it is compared with the money you put up. That is why leverage cuts both ways: with ₹50,000 you could take five such intraday positions, and a ₹5 move against all of them would cost ₹2,500, or 5% of your money, in one move.
T+1 settlement
India moved to T+1 settlement for equities in stages, completing it in January 2023. If you buy shares on a trading day (T), they are credited to your demat account on the next trading day (T+1). If you sell holdings, the money is settled on T+1 as well. Intraday trades net out to zero within the day, so nothing is delivered.
One quirk: shares bought on CNC may show in your holdings on the next day before they are fully settled. Brokers show these as "T1" holdings, and selling them before settlement carries a small risk if the seller on the other side fails to deliver.
Charges differ
Securities Transaction Tax (STT), stamp duty and some brokerage plans differ between intraday and delivery. Intraday has lower STT per trade, but people who trade intraday usually trade far more often, so total costs can add up quickly. Estimate yours with the brokerage calculator, and read trading charges explained for each line item.
Tax, briefly
The two styles are taxed differently under Indian income tax rules:
- Intraday equity profit or loss is treated as speculative business income. Speculative losses can generally be set off only against speculative gains.
- Delivery trades are taxed as capital gains: short-term if held for 12 months or less, long-term if held longer, each with its own rate.
F&O is separate again. Rules change with each Budget, so read the F&O tax guide for details and check with a tax professional for your own case.
Which one suits whom?
There is no better style in general. Delivery gives you time and avoids forced exits, but ties up more money. Intraday frees capital each evening but gives you only a few hours for a trade to work, adds the risk of leverage, and usually means more trades and more costs. Whatever you choose, fix your loss first with a stop-loss and size from it.
Risk reminder
SEBI's own research has repeatedly found that most individual intraday and F&O traders lose money; its studies (2023 and 2025) found about 9 in 10 individual F&O traders lost money in the years studied (SEBI). Leverage makes those losses arrive faster.
Questions people ask
- What happens if I forget to close an MIS trade?
- Your broker will close it automatically near the end of the day, at the market price then, and may charge a fee for doing so.
- Can I convert an intraday trade to delivery?
- Most platforms let you convert MIS to CNC before the square-off time, provided you have enough funds to pay the full value.
- How much leverage can I get intraday?
- Under SEBI margin rules, equity cash trades need at least about 20% margin, so leverage is capped at roughly 5 times and is lower for riskier stocks.
- When do bought shares reach my demat account?
- Under T+1 settlement, shares bought on a trading day are credited on the next trading day.