The Stock Market is something that entices almost everyone. It is a great investment option, with high ROI (Return on Investment).
Share trading is a flexible form of investment where you can invest in the Stock Market through buying and selling of shares. However, this first requires a Trading account.
There are many aspects to be considered while opening a Demat account such as the broker and the brokerage charges, user interface of the app and multiple options in trading.
There are many brokers who will allow investors to open easy Demat accounts, but the best Trading account for beginners is one with low brokerage charges.
Gone are the days when people needed share brokers to be physically present. Today, people trade via brokerage apps. This means that the user interface of the app plays an important role in shaping your trading experience.
Today, Trading accounts are used not only to invest in shares but also to invest in bonds, mutual funds and other forms of investments that are available via trading apps.
However, investors should not confuse a Trading account with a Demat account. But first, let us understand how the Market operates.
All shares are listed on the BSE and NSE. Brokers are authorized by SEBI (the regulating authority) to trade in shares on your (the investor’s) behalf, while a Depository Participant (DP) will hold and reflect the investments in a dematerialized form.
When it comes to the different types of accounts, a Trading account is used to buy and sell stocks. On the other hand, a Demat account holds all your investment details regarding the Stock Market, such as your investments and information regarding your trading account. Thus, you have to open a Trading account with an authorized broker.
This process has become much simpler today with digitalization, with online apps becoming some of the best share trading platforms for beginners. Let us walk through the fundamental process of opening a Trading account for beginners:
1. Choose a broker. There are many leading brokers in the Market.
An investor can consider these points to decide which platform offers the best Trading accounts for beginners:
-Compare the charges or brokerage commission applicable on the trading of shares
-Compare the Annual Maintenance Charge applicable every year
-Check the interface speed, which is helpful for intraday trading
2. Fill in the application details and provide identity proof for KYC verification. Brokers usually ask for your PAN card. If you are opening an online account, an online photo and signature are required. You may also need to record a video - mentioning your proof of identity and that you wish to open an account with the respective broker.
For additional services after opening the account, you may have to submit your financial statements (if you have any) such as a Profit and Loss Statement or balance sheet.
3. Read the instructions, charges of trading, and the terms and conditions carefully before confirming.
As soon as the broker approves your account, you will receive your login credentials. This means that you are now ready to trade shares. Ýou can create a watchlist of shares you are planning to invest in, keep an eye on them, and trade whenever you spot an interesting opportunity.