Delivery trading is the most common type of trading in India, commonly used by investors. In this method, investors pay the full price of a stock (equity) with no margin given, and the shares of the stock are deposited into their demat account. Delivery trading is associated with investors because, unlike day-traders who aim to enter and exit trades within the same day, investors typically hold their positions for a longer term.
The benefit of delivery trading is that there is no time limit for selling the stock. However, a disadvantage is that delivery trading involves higher costs than intraday trading. The Securities Transaction Tax (STT) is higher for delivery trades compared to intraday trades. Furthermore, there is also no margin given to an investor when they engage in a delivery trade. Finally, a drawback of delivery trading is that short-selling stocks is not allowed.