Basics of a trading account in India

This might seem like common knowledge but it is important to note that you cannot trade in the stock markets without a trading account. It goes back to the basic rule of stock exchanges—in order to be a trader, where stock brokers enter the picture. Stock broking firms like Upstox offer trading account services to its clients. Since stock brokers are already registered members of the stock exchanges (Upstox is registered with BSE, NSE and MCX).

—Intermediary Account

An account meant for trading can be considered as an intermediary account connecting your bank account and demat account. In order to purchase shares, you have to transfer funds from your bank account to your trading account. Once you purchase your shares, they are kept in your demat account until the time that you are ready to sell them. Once you are ready to sell those shares, the shares are shifted from your Demat Account back into your Trading account. Thus, your this account of yours can hold both cash and securities.

—Different financial instruments

A trading account opens up the opportunity to invest in various kinds of instruments. You can purchase common stocks, trade in the derivatives market such as on Futures and Options etcetera. You can also trade on Equities, Commodities, Currencies, F&O as well with the help of an account exclusively meant for trading, with Upstox.

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