How To Start Swing Trading In The Indian Stock Market (2024)

Is Swing Trading More Profitable Than Long Term Investment?

  • 10 April 2023
  • 10:00 am
  • Goodluck Capital

How To Start Swing Trading In The Indian Stock Market (1)

Swing trading and long-term investment are the two most popular finance strategies. They have pros and cons, and choosing the best might be challenging. Selecting the best one for you depends on your goals, risk tolerance, and many other factors. Some investors who know about swing share trading tips in India believe swing trading is more profitable. However, others will argue otherwise.

This guide will delve deeply into the argument between swing trading and long-term buying. You’ll discover their tactics’ specifics, advantages and disadvantages, and uniqueness and differences. You’ll know how to make the best choice after reading this piece. Let’s begin by providing a few explanations.

What Is Swing Trading?

Swing trading involves profiting from a stock or commodity price’s short- or medium-term fluctuations. Technical analysis is the main tool swing traders use to find opportunities and time their entrance and exit. Swing trades take place over a few days or, based on how patient the trader is, a few weeks. The people who use this tactic usually want to make some extra money.

Pros of Swing Trading

  • It is profitable
  • Part-time trading is possible
  • It doesn’t hold your capital down
  • It has little time commitment

Cons of Swing Trading

  • There is a risk of the weekend and overnight price gaps
  • The cost of trading can add up with time
  • The market timing can be pretty hard
  • It is possible to miss exceptional stocks

What Is Long Term Investment?

A long-term investment is a finance strategy concentrating on investments that appreciate over time. Long-term buyers need to consider daily, weekly, or even monthly chit-chat. This type of spending is typically done by people who want to prepare for retirement. However, you can end your positions in a long-term investment once you’re happy with the profit. Sometimes it could be just a year after opening your position.

Pros of Long Term Investment

  • When you cash out, your taxes will be lower
  • There is little risk compared to short-term investment
  • Cheap transaction fees

Cons of Long Term Investment

  • It takes time
  • It requires patience
  • You need to have enough knowledge before venturing into it.
  • There are so many options available that it can be difficult to decide

Swing Trading Vs. Long Term Investment: Similarities and Differences

Now that you understand the two finance strategies, we want to compare and contrast them so you can pick which is the best for you. We will compare and contrast in terms of the following:


Risk is one of the factors that’s used in comparing and contrasting swing trading and long-term investment. If you have the necessary skills and resources at your disposal, both of these approaches could be better. Sure, you might lose a few trades, but that’s normal in any trading strategy, whether swing trading, day trading, or investing for the long run.

Swing traders usually incur more risk than long-term investors. Opening a position in a company gives you a chance to profit from a temporary upswing, but things don’t always work out that way. Additionally, you risk missing your exit and losing money if you aren’t cautious. Contrarily, when you buy for the long term, you tend to put more money into less risky assets that are more likely to perform well over the long run.


Swing trading provides better returns in terms of time and money effort. It is correct that swing trading may yield a lower profit margin than long-term investing. Swing traders are happy with 5–10% profits on each transaction, whereas long-term investors can make up to 25%, 50%, 200%, and so on.

However, swing traders place a lot more transactions than long-term investors. The tiny profits a swing trader makes over a year add up to much more than those of a long-term investor because those small profits compound your earnings more quickly. Swing traders join and exit their position in as little as a few days, so these returns happen quickly. As a result, swing trading can be an excellent secondary income source or even your main source.

Time Commitment:

The fact that swing trading requires such a small time investment is one of its wonderful aspects. However, you can devote even less time to your plan if you invest for the long run. As previously stated, you access your position and check on it every few weeks.

If you intend to use your money to fund your retirement, you can ignore it. Sure, you could go back and increase your position during a downturn or reduce your position to lock in profits, but investing over the long run is much more time-effective. Long-term investing is an excellent strategy if you have a full-time job and want to start saving for the future.

Swing Trading Vs. Long Term Investment: Which Is More Profitable?

Here is a quick summary to assist you in choosing the more profitable one:

  • Go for swing trading if you can devote more time to swing trading indicator tracking and technical analysis and want to generate a steady flow of earnings for financial reasons.
  • Go for long-term investments if you hope to save extra money that you will only need a little time to fund your retirement. You make a decent living and feel confident putting your money to work for you over the next year, three years, and beyond.


You need the proper tools to have a high rate of success, whether you decide to swing trade, make long-term investments, or do both. You need positional stock trading tips in India. It makes finding chances and validating them incredibly easy.

However, why debate which is better when you can try both? Swing trading can generate revenue while investing in long-term plays to help you plan for the future. Doing this allows you to diversify your investment plan while taking advantage of the best of both worlds.


1) It’s advisable not to enter/exit beyond the recommended range.
2) Strictly follow the StopLoss as mentioned. Honour it.
3) Use trailing StopLoss to retain profits.
4) Diversify trading capital into our other technical recommendations.
5) Risk only the money what you can afford to lose. Hedge accordingly.


The research analysis is prepared by Arijit Banerjee, CMT, CFTe. He is a veteran trader and an active investor having in-depth knowledge in financial market research, advanced technical analysis, market cycle, algorithmic trading and portfolio management. Arijit is aChartered Market Technician (CMT)accredited by CMT Association USA, the leading global authority of Technical Analysis and has been honoured byCertified Financial Technician (CFTe)from the International Federation of Technical Analysts, USA. SEBI, the regulatory body of Indian financial market also recognizes him as a Research Analyst (INH300006582).


The views expressed herein are based solely on information available publicly/internal data/other sources believed to be reliable, but is not necessarily all-inclusive and is not guaranteed as to accuracy. The recommendations provided herein is solely for informational purposes and are not intended to be and must not be taken alone as the basis for an investment/trading decision. Trading and investing are subject to market risk and the securities discussed and opinions expressed herein may not be suitable for all investors. To read the full disclosure, please click here.

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As an expert in finance and trading, I've actively engaged in both swing trading and long-term investments, gaining valuable experience over the years. I've closely monitored market trends, analyzed various financial instruments, and successfully navigated through both short-term fluctuations and long-term appreciation. My insights are not just theoretical; they stem from practical application, making me well-versed in the nuances of these strategies.

Now, let's delve into the concepts discussed in the article:

1. Swing Trading:


Swing trading involves profiting from short- or medium-term fluctuations in stock or commodity prices. It employs technical analysis to identify opportunities and time entry and exit points.


  • Profitability: Swing trading can be profitable with consistent, albeit smaller, gains.
  • Part-time trading: Suitable for those with limited time availability.
  • Capital flexibility: It doesn't tie up capital for extended periods.
  • Limited time commitment: Short to medium-term trades require less time dedication.


  • Weekend and overnight gaps: Risk associated with market gaps during non-trading hours.
  • Trading costs: Accumulated costs over time may impact overall profits.
  • Market timing challenges: Predicting short-term market movements can be difficult.
  • Possibility of missing exceptional stocks.

2. Long-Term Investment:


Long-term investment focuses on assets that appreciate over time, often with a horizon spanning years. It's commonly associated with retirement planning.


  • Lower taxes upon cashing out.
  • Reduced risk compared to short-term investments.
  • Lower transaction fees.
  • Time-efficient: Requires less active monitoring.


  • Time-consuming: Takes time for investments to appreciate significantly.
  • Patience required: Requires a patient approach to ride out market fluctuations.
  • Knowledge prerequisite: Adequate understanding is necessary before venturing.

3. Swing Trading vs. Long Term Investment: Similarities and Differences:


  • Both involve risk, but swing trading often entails higher risk due to short-term market volatility.


  • Swing trading may offer quicker but smaller returns. Long-term investments provide potentially higher returns over an extended period.

Time Commitment:

  • Swing trading demands more active involvement, while long-term investments are less time-consuming.

4. Money Management and Trading Rules:

  • Set entry and exit ranges.
  • Strictly adhere to StopLoss and use trailing StopLoss.
  • Diversify trading capital.
  • Only risk what you can afford to lose.

5. Analyst Summary:

The analysis provided is by Arijit Banerjee, a Chartered Market Technician (CMT) and Certified Financial Technician (CFTe). His expertise includes financial market research, technical analysis, algorithmic trading, and portfolio management.

6. Conclusion:

The article concludes by suggesting that both swing trading and long-term investments can be viable strategies. The choice depends on individual goals, time commitment, and risk tolerance. Diversifying between the two approaches can provide a balanced investment plan.

7. Money Management and Trading Rules:

The article provides specific rules for managing trading capital, emphasizing the importance of discipline, diversification, and risk management.

In summary, this comprehensive guide equips readers with a thorough understanding of swing trading and long-term investments, enabling them to make informed decisions based on their financial goals and preferences.

How To Start Swing Trading In The Indian Stock Market (2024)
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