What is a Share Trading Account?

How to Open a Share Trading Account?

You are free to use this image on you website, templates, etc., Please provide us with an attribution linkHow to Provide Attribution?Article Link to be HyperlinkedFor eg:Source: Share Trading Account (wallstreetmojo.com)

  • Select Broker The first step is to select a broker or a firm. The broker provides services concerning buying and selling securities apart from additional research and advisory services. Compare Rates Every broker or firm will charge you different brokerage rates, commissions, and other charges. Therefore, it is essential to understand every fee charged and compare them with other service providers. Then, based on your comparison, you may select one broker. Provide KYC You will be required to provide your basic KYC documents, such as identity proof, residential proof, income proof, and other details. Fill up the Application Form Along with the competition of KYC, you will also be required to fill up the application form. Verification of the Application The broker firm will verify your application, and once your application is processed and verified, they will provide you with your trading account details.Thus, opening a share trading account is straightforward and less time-consuming.

The first step is to select a broker or a firm. The broker provides services concerning buying and selling securities apart from additional research and advisory services.

Every broker or firm will charge you different brokerage rates, commissions, and other charges. Therefore, it is essential to understand every fee charged and compare them with other service providers. Then, based on your comparison, you may select one broker.

You will be required to provide your basic KYC documents, such as identity proof, residential proof, income proof, and other details.

Along with the competition of KYC, you will also be required to fill up the application form.

The broker firm will verify your application, and once your application is processed and verified, they will provide you with your trading account details.Thus, opening a share trading account is straightforward and less time-consuming.

How to Use a Share Trading Account?

Once your trading account has been opened, you may want to start using your trading account. But as a beginner, if you are going to use the trading account on your own, i.e., without the aid of brokers or other experts, you shall follow the following basics.

#1 – Learn the Basics

You must have basic knowledge of the trading terms. You can achieve the learning by way of trading booksTrading BooksTrading book is the type of book maintained by the bank, financial institution or a stockbroker banks for recording the transactions of the clients who have given them an opportunity to act as the broker or middle person for dealing in securities. read more, stock market-related websites, and news channels.

#2 – Follow the Market Movements

Keep a look at the trends in the movement of the market. You can do so for the overall market and some particular stocks. You shall also observe how any news related to a company affects its stock price.

#3 – Broker Services

Initially, you may take the help of brokers and independent professionals who may guide you with your investments in return for fees. However, one should not rely entirely on them as they may not be accurate every time.

#4 – Select Stocks

After you start the following market, you will get an idea of which stocks are expected to do better. Then, select the stocks you want to purchase and invest in based on your analysis. You may start with a smaller amount of investments.

#5 – Stop Loss

The term stop loss orderStop Loss OrderStop-loss order is an advanced computer-activated trade tool that is primarily used to execute a trade for a certain stock if only the predetermined price-levels are attained while trading, i.e. it sells a specific stock when it is triggered and is useful for reducing the investors’ loss burden.read more means instructions given by you to your trading account that the stock shall be sold automatically when the price of the stock reaches a minimum price level. Since you have decided, it is known as stop-loss. It will help you limit your losses being a new investor.

Why Should You Open Share Trading Account?

You must hold a trading account to trade in various stock market instruments such as shares, mutual funds, debts, derivatives, etc. When a person has an online trading account, he can transact hassle-free and quickly via the online platform. Nowadays, trading accounts also have updated news and other features that help investors make well-informed investment decisions. Also, the trading account provides you with the latest financial data concerning your holdings. On the other hand, if you carry out the share trading by physical mode, it will take too much of your time, and the cost involved will also be more.

Conclusion

Nowadays, most investors have access to a share trading account, from wherein they carry out trading transactions concerning securities using a secure and advanced platform. In addition, online trading accounts have made the trading process easy and quick.

This article is a guide to the Share Trading Account definition. We discuss how to open a share trading account and why we should open this account. You may learn more about financing from the following articles:-

  • Form 8-KHow Share Markets Work?Ordinary Shares DefinitionShare ClassesNominal Value of Shares