Day trading, a prominent form of short-term investment strategy, has been rapidly gaining traction in India. It involves purchasing and selling financial instruments within a single trading day, with the goal of capitalizing on small price fluctuations. Although day trading can be a lucrative avenue of investment, it’s also a complex undertaking that requires a thorough understanding of financial markets, a sound strategy, and a firm ability to manage risk.

Day trading in India can be a source of substantial income, but it is not a guaranteed money-making formula and it involves significant risk. Those considering such a career should be prepared for the potential losses and the need for a substantial time investment. It requires a deep understanding of financial markets, an effective trading strategy, and a disciplined approach to risk management.

day trading earnings in india

Earning Potential of Day Trading in India 

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The income potential from day trading in India is highly variable, depending largely on the trader’s skills, risk tolerance, investment size, and market volatility. As such, it’s difficult to quantify a standard expected income. However, successful day traders can potentially earn a substantial percentage of their investment as profit. 

On a day with high market volatility, proficient traders might earn anywhere from 2% to 5% on their total investment, although such high returns are not guaranteed and can involve significant risk. Moreover, these are gross earnings and do not account for transaction fees, taxes, and other overhead costs.

Factors Affecting Day Trading Earnings 

1. Investment Size: Earnings from day trading are often proportional to the amount invested. A larger investment may yield higher absolute profits, though it also carries increased risk.

2. Market Knowledge: Traders with a solid understanding of the market, including knowledge of trends, strategies, and financial analysis, generally earn more than novice traders.

3. Risk Management: Long-term successful traders have effective risk management strategies that help limit and handle losses.

4. Trading Strategy: The type of trading strategy used, such as scalping, swing trading, or arbitrage, can significantly impact earnings.

5. Transaction Costs: High transaction fees can significantly reduce net earnings, particularly for traders who execute a large number of trades in a single day.

6. Market Volatility: Greater market volatility often provides more profit opportunities, though it also increases risk.

Rakesh Jhunjhunwala – An Example of a Successful Day Trader in India 

There are many examples of successful day traders in India who have amassed significant wealth through their trading activities. One such example is Rakesh Jhunjhunwala. He started his trading career with just INR 5000 and eventually became a billionaire through day trading and other investment strategies. However, these success stories are the exception, not the rule. For every successful trader, many more struggle to break even or make a modest profit. Do not risk money you can not afford to lose.

Rakesh Jhunjhunwala

Rakesh Radheyshyam Jhunjhunwala (1960 – 2022) was born in Hyderabad to a Rajasthani Marwadi family. After graduating from the Sydenham College of Commerce and Economics, he enrolled at The Institute of Chartered Accountants of India. As a Chartered Accountant, he developed a deep understanding of company valuations.

Getting Started With Trading and Investing

His investment career began with a comparatively modest 5,000 Indian rupees in 1985 and he made his first major profit in the stock market the following year. His father encouraged his interest in trading, but did not give him any capital and also forbade him from asking friends for money. Therefore, Jhunjhunwala´s trading started with his own saved up money.

Between 1986 and 1989, Jhunjhunwala made around ₹20–25 lakh in profits from his trading.

An Estimated Net Worth of 5.8 Billion USD

At the time of his death in 2022, he had an estimated net worth of 5.8 billion USD. In 2023, he was posthumously awarded the Padma Shri, the fourth-highest civilan award in India. This award, established in 1954 by the Government of India, is given to recognize a person´s “distinguished contribution in various spheres of activity including the arts, education, industry, literature, science, acting, medicine, social service and public affairs”.

During his lifetime, his philanthropic work included donations to health care and educational initiatives, including organizations such as Ashoka University, St Jude of India, Agastya International Foundation, Friends of Tribals Society, and Olympic Gold Quest.