How to start share trading in India?
Many investors wanting to speculate in stocks are coming over to India as the market is booming and in the last few decades there has been a huge inflow of money into the stock markets. But to go about investing in stocks in India you need to follow some basic guidelines that have been simplified in the last few years. It does not mean you get an upfront idea of investing in stocks and what to buy and what not to buy as they are dependent on your own research.
Get a Indian demat account done
You May Also Be Interested In
You have to get a dmat account done after which you have to open a trading and savings account with a bank that deals in stocks and has the necessary facilities for providing you an opportunity to trade. The trade account enables you to get an account number as it is very much similar to a bank account number. Instead of the paper documents that investors had earlier regarding their stock holdings, they now have a dematerialized account.
The shareholdings are online and the entire system is on the computer. Instead of holding cash like a bank account, a dmat account holds shares. Once the shares are bought, they are deposited into the bank demat account of the investor and as soon as it is sold, the result gets reflected in the online trading account.
You deal in electronic shares and for starting stock trading in India, you need to have a dmat account done.
You cannot trade in physical shares anymore these days in India and the system has become easier and more simplified.
If you want to trade in stocks, you can just do it online from the comfort of your home at the click of a mouse. It is easy to handle demated shares compared to sheaf of papers investors had to carry along with them earlier and you can open a account at any bank or financial institution after filling out the necessary papers.
You need to provide the required identity and address proofs as well as the permanent account number allotted to you by the Indian income tax authorities. There are charges associated with demating shares and the bank or financial institution will debit your account with the necessary charges. There are charges for opening such a account for trading shares, annual maintenance charges and other regular expenses for holding shares in demat account.
Best Done On Line
Levies or charges are liable to be paid not when you buy shares, but only when you sell them. You can check with different providers as the charges and expenses for a demat account can vary. You can trade over phone after you fix up brokers who will allot you a code number for trading in stocks. You can also trade online if the broker has online trading facilities. Buying and selling over the internet is fast gaining popularity all over India.
You can track your trades better online and monitor stocks more easily. It is easier to trade online rather than over the phone that can cause frequent delays. Brokers charge a commission for all purchases and sales. Money for buying the shares will have to come from your bank account and once the shares are sold, you can get the proceeds deposited into the account after the usual time period which can vary from 3 to 5 working days.
When you want to buy shares, you can just log into the trading account where the company name, current price and details pop up. You can click buy and enter the lot and then wait for the price to reach a point where you can sell for a profit using the same methods.