What are BTST & STBT: Everything Beginners Need to Know

BTST and STBT Trading: A Beginner's Guide

The stock market may be a familiar place for earning returns within hours with the right investment choice. But there are also investments that you can profit from overnight.

Trading during the extended market or non-trading hours through BTST (buy today sell tomorrow) and STBT (sell today buy tomorrow) methods can propel your returns and aid in capitalising on short-term price fluctuations.

This starter guide helps you leverage these less-explored trading strategies by defining them and their process. We also have tips to become proficient in trading through methods like BTST and STBT.

BTST and STBT: What Do They Mean in Stock Trading?

The average stock market beginner may get the abbreviations BTST and STBT mixed up. To ensure you will always understand BTST and STBT, we will lay a solid foundation to ensure you always distinguish the two.

1. BTST (Buy Today, Sell Tomorrow)

A BTST trading strategy consists of individuals purchasing stock shares today (T) while markets are open, only to sell them the next day (tomorrow T+1) before the market even opens for business at a higher price.

The concept behind the BTST investment technique is that investors buy stocks expecting their prices to increase throughout the night while the market is closed.

A move like this would allow investors to capture good investment gains without waiting for the trading session to reopen.

The Complete BTST Trading Process

• An investor will start by identifying a purchasable share based on its market position, expecting the price to increase shortly.
• Before purchasing, the investor will enquire if the selected stock is eligible for a BTST trade.
• After completing the trade transaction and minimal formalities, the investor owns the BTST stock.
• The investor will complete the sale of these BTST stocks the next day before the market opens.

2. STBT (Sell Today, Buy Tomorrow)

In the STBT trading strategy, individuals will sell their shares today (T) and purchase them back tomorrow before the market reopens for business (T+1).

Inversely, the BTST technique concept is that investors sell stocks at a higher price, expecting their prices to drop over the night before the market opens.

The investor benefits from the higher selling price and can benefit from a lower buyback price as well.

The Complete STBT Trading Process

• The STBT stock trading technique starts with an investor selling their shares of the sell today buy tomorrow eligible stocks during market hours.
• The transaction is complete before the close of the market on the same day based on the STBT position.
• The next day (T+1), the investor will buy back all the sold shares before the market opens.

BTST and STBT Stock Trading Tips for Beginners

If you are looking for tips to become an expert in BTST and STBT and rule the market with this new technique, here are some.

Research Well

If you plan to dive into STBT and BTST trading, ensure you base your actions on sound proof and research rather than impulse.

Be sure to undertake due diligence and pursue research and technical analysis rather than place your investments based on an assumption of false hopes!

Clarify Legalities and Trading Rules

Before investing through the BTST and STBT stock trading techniques, you'll want to see the legal policies surrounding it.

In addition, have a conversation with a trading expert about the rules and regulations that govern BTST and STBT trading.

Start With a Trial Attempt

Since it will be your first time trying this new trading technique, start with a small investment. Gradually build yourself up to bigger ones, knowing you will gain knowledge and experience with each BTST and STBT trade investment.

Keep Updated

Successfully trading through BTST and STBT requires constant effort to stay informed about changes in the technique, guidelines, and policies.

Analysing and tracking developments through the economy, government regulations, and stock market research can be of assistance in enhancing your BTST and STBT stock trading skills.

Seek Advice from Experts

There are professional stock market analysts and investors with an excellent track record in trading in BTST and STBT. You can seek their expertise as they can provide services by alerting you to the appropriate stocks in BTST calls.

Conclusion

You can consider BTST and STBT trade techniques as ones used to return gains on a short-term basis due to rapid overnight price increases/decreases.

It takes careful research, analysis, and development of stock trading skills to master the art of trading in stocks for BTST and STBT techniques.

If you lack the time to develop the necessary skills, you can always hire a BTST trading service for expert assistance in stock trading.

Hi, My name is Rahul Singh. I am a blogger. My blog explores the interesting reasons behind stuff in the world. We'll find cool facts you never knew and open your mind to new ideas!