Intraday Trading vs. Interday Trading: A Comprehensive Guide

Traders on the floor of the New York Stock Exchange.

Intraday and interday trading are different philosophies investors use when looking to make a profit on the stock market, based both on their desire for risk and their ability to invest time.

Intraday

Intraday trading involves buying and selling a stock or number of stocks between the open and close of one trading day. Stocks are not held long-term.

Interday

In interday trading, a stock is bought and held for longer than a given trading day on an exchange. Interday trading can represent short-term or long-term trading strategies.

Advantages

Intraday trading offers investors the ability to profit from the frequent fluctuations in markets throughout the course of a day. Interday strategies are less time-consuming.

Disadvantages

Interday trading can be an issue for investors if a stock or fund suffers a great loss in the course of a day and they do not sell. Intraday trading requires traders to make more money than the price of buying and selling the stocks in order to turn a profit.

Other Markets

In addition to U.S. stocks, interday and intraday trading often occur in currency markets, where global financial centers are open at different times. This allows investors to make trades moving money from one exchange to another.