Falling for Btst BTST (Buy Today, Sell Tomorrow) is touted as a hot trading product by brokers and is often pushed to retail investors citing high profits and low risk method to trade. However, when you sign for BTST, you are asked to sign for a long list of Risk elements which covers the broker completely, but leaves you exposed. You as a retail investor might get trapped if there is an issue with the BTST trade. Let's look the risks involved in BTST. When you purchase a Stock, it takes minimum of 2 days for the stock to come to your Demat account. So doing a BTST, i.e. buying the Stock today and Selling it tomorrow is not a natural thing to do. You are actually selling something which is not yet in your possession. So why do brokerages allow this and actually push the product to you and encourage you to do it. Simply because they earn their commissions today, when you buy and another commission tomorrow when you sell. And also because you have already signed on risk papers, so all risk belongs to you and not to the brokerage house or the exchange, if anything goes wrong. What all things can go wrong in a BTST? If the Seller party which promises to sell the stock to you defaults, then you will not get the stock in your account. But, by doing BTST, you have already sold the stock the next day and hence you are also in risk of doing a default now. So the brokerage house, would try to procure the stock during an auction process, and hence you may end up paying much higher for the stock you sold than the sale price you committed to. If unfortunately, the stock is caught up in consecutive upper circuits, and there are no sellers available for next few days, the penalties can be much higher for you. BTST is anyways not a natural way to trade. If you like a stock, and think it will go up, there is no harm in waiting two days rather than one and then selling the stock, once you actually have the stock in your demat account. Online brokers try to limit to BTST to only highly liquid top 200 stocks, but if anything goes wrong, the entire risk is yours, so risk-reward is skewed against you in a BTST trade.