We should always have a backup. Stock investment help to create this additional source of income. we’ve worked hard to make money, now put it to work. When we want to step into the share market, several questions strike in our head – like, How to start trading stocks in India? or, How to open a share trading account?
Basic of Share Trading
In India for Share trading, you need 3 types of accounts –
1. Trading Account to place buy/sell orders.
2. Demat Account for holding shares in dematerialized form.
3. and finally, a Bank Account for fund transfers.
Demat and trading accounts in India are provided by the two depositories NSDL (National Securities Depository Limited) and CDSL (Central Depository Securities Limited) through brokerage firms. And, most of the stocks trading in the Indian stock market listed in two stock exchanges- NSE (National Stock Exchange) and BSE (Bombay Stock Exchange).
Read also:Which is better BSE or NSE?
Steps to open a Share Trading Account
1. Find a broker or firm:
There are lots of good brokerage firms available in the market. The very first step is to find one of them. Stockbrokers are basically two types – full service and discount.
A full-service broker is a licensed broker-dealer firm. They provide a variety of services to their clients along with buying and selling of shares such as research and advice as well as retirement and tax planning and much more.
While a discount broker charges a much lower fee than full-service brokers. They provide no such buying and selling advice. They only provide the necessary trading facility in minimized cost.
2. Compare brokerage rates and facilities provided:
Every brokerage firm charges fees to the investors to process their buy/sell orders. These charges are different for different brokerage houses. Some give discounts on the basis of the number of trades conducted. So, It is important to understand all the dealing facilities before opening an account. But don’t worry, all the leading brokerage firms provide 24X7 customers care services for any issue. Before engaging, investors just need to understand the facilities offered.
3. Complete KYC and document submission:
To complete the KYC part you either can visit the broker’s office physically or can ask the broker to send its representative to their house along with the account opening form and the Know Your Client (KYC) form.
You just need to fill up these forms and submit with required documents (identity proofs and address proofs such as Voter ID card, PAN card, Passport, Aadhar card etc.
Once your application is verified, you will be given your trading accounts details through Email and SMS services. After activation, you can place your buy/sell orders in your own trading account.
Therefore, in this way anybody can open a share trading account and start investing. Are you excited? I know you are. So, what are you waiting for? Happy investing…
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