Can You Sell Shares You Bought Yesterday? A Guide to BTST Trading

Many investors wonder if they can sell their shares immediately after purchasing them, and the answer is a resounding yes, especially within the context of BTST (Buy Today, Sell Tomorrow) trading. The key concept here is that you can indeed sell the shares you held under T1 days, or, more specifically, if you buy a security on day 1 and sell it within the same day. This type of trading is known as BTST.

Understanding BTST Trading

BTST trading is a strategy where you buy the shares on the first day and sell the same shares on the T1 day. This BTST trade, as it's popularly known, allows you to trade within a single day. However, there is a catch. Let's break down the details.

Settlement and Delivery

Whenever you buy any stock, it is required to be settled on day T1. This means the Clearing Corporation, which is responsible for the transaction, must get the stock from the counterparty and deliver it to you. But what happens if you do not receive the shares? This phenomenon is known as short delivery. If you attempt to sell the shares before you receive them, this triggers a short delivery and comes with additional steps to correct the issue.

What Is Short Delivery?

Short delivery occurs when you sell a security before the T1 settlement is complete. According to the rules of the stock exchange, you have to wait until the shares are settled, which typically involves an auction process by the exchange to ensure fair distribution.

Recognizing Short Delivery

Once you experience short delivery, you might see that the share’s purchase average price is not reflected in your holding page. This is a clear indication that your shares are short delivered and you have to wait for them to settle.

BTST Trading and Its Benefits

Now, coming back to your question, yes, you can do so today by selling the shares bought yesterday, provided the shares meet the criteria for BTST trading. However, not all shares qualify for this type of trading.

Qualification for BTST

For BTST trading to be valid, the shares must be held in your portfolio and the sale must occur within the T1 day. This type of transaction is considered a delivery trade. If you sell it on the same day, it is also an intraday trade.

Brokerage and Fees

Since it is a delivery trade, the brokerage fees will be charged accordingly. Fortunately, many discount brokers, such as Fyers, Zerodha, or Upstocks, provide zero brokerage for delivery trades. This makes BTST trading a very advantageous strategy for short-term targets with minimal cost.

Conclusion

To summarize, you can definitely sell shares you bought yesterday if they qualify for BTST trading and if you follow the proper procedures to ensure there are no complications such as short delivery. With the right strategy and the right brokers, you can optimize your trading by utilizing the BTST method.

If you have any questions or need further clarification, feel free to ask. Happy trading!