Unlike the popular belief, a common investor can't buy or sell shares of listed public companies from a Stock Exchange. You can only go through a broker who is acting on behalf of the stock exchange.
In order to trade in stocks the following is required.
1. Bank Account - This is where you would like to keep your funds for buying of shares or when you sell shares the amount to be credited.
2. Trading Account - This is an account provided by the Broker for us to trade in the stocks on behalf of an exchange.
3. Demat Account - This is an account where we keep our shares in a digital format. Previous to this we had to physically store these shares in paper formats which was a big hassle.
For each of these services the providers would charge a fee for the same. As a value investor its better to find a provider that gives an integrated account that gives all the three services. One should also keep note of the cost associated and compare the different providers before choosing one. One should also bargain with them to reduce the fees.
The other requirement for trading in Indian context is that you need to have a Permanent Account Number (PAN) from the Income Tax department.
Most major banks like SBI, ICICI etc provide these integrated services. Others provide only the Trading account while the other service accounts are shared.
In order to trade in stocks the following is required.
1. Bank Account - This is where you would like to keep your funds for buying of shares or when you sell shares the amount to be credited.
2. Trading Account - This is an account provided by the Broker for us to trade in the stocks on behalf of an exchange.
3. Demat Account - This is an account where we keep our shares in a digital format. Previous to this we had to physically store these shares in paper formats which was a big hassle.
For each of these services the providers would charge a fee for the same. As a value investor its better to find a provider that gives an integrated account that gives all the three services. One should also keep note of the cost associated and compare the different providers before choosing one. One should also bargain with them to reduce the fees.
The other requirement for trading in Indian context is that you need to have a Permanent Account Number (PAN) from the Income Tax department.
Most major banks like SBI, ICICI etc provide these integrated services. Others provide only the Trading account while the other service accounts are shared.
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