How to open a Trading Account
Since 2000, the stock markets have become electronic. This means, trading is conducted online. Today, you need a demat and a trading account to invest in the stock market. A trading account is opened with a stock broker.Most often, stock broking firms have thousands of clients. It is not feasible to take physical orders from every client on time. So, to make this process seamless, you open a trading account. Using this account, you can place buy or sell orders either online or phone, which will automatically be directed to the exchange through the stock broker .
Here's how you open a trading account
- First, select the stock broker or firm. Ensure that the broker is good and will take your orders in a timely manner. Remember, time is of utmost importance in the stock market. Even a few minutes can change the market price of the stock. For this reason, ensure that you select a good broker.
- Compare brokerage rates. Every broker charges you a certain fee for processing your orders. Some may charge more, some less.
- Some give discounts on the basis of the amount of trades conducted. Take all this into account before opening an account. However, remember that it is not necessary to choose a broker who charges the lowest fees. Good quality brokerage services provided often may need higher-than-average charges.
- Next, get in touch with the brokerage firm or broker and enquire about the account opening procedure. Often, the firm would send a representative to your house with the account opening form and the Know Your Client (KYC) form
- Fill these two forms up. Submit along with two documents that serve as proof of your identity and address.
- Your application will be verified either through an in-person check or on the phone, where you will be asked to divulge your personal details.
- Once processed, you will be given your trading accounts details. Congrats, you will now be able to conduct trades in the stock market
WHAT ARE THE DOCUMENTS REQUIRED?
Just like the procedure for opening a demat account,
you need to submit proofs of identity and address along with a passport
size photograph and the account opening form for opening a trading
account.
Here is a broad list of documents that can be used as proofs:
No comments:
Post a Comment