If that’s the case, here’s a comprehensive guide that can help give you some much-needed information on how to trade online using a trading account. But before you dive right into the process, you need to first understand the concept of a trading account.
A trading account is a platform that enables you to buy and sell securities such as equity shares, bonds, debentures, mutual fund units, Exchange Traded Funds (ETFs) and derivative contracts like futures and options.
The securities that you purchase are stored electronically in a demat account that’s linked to your trading account. A demat account is a digital account that’s separate from a trading account. The demat account is used only to store securities safely and securely in an electronic form.
Both the trading account and the demat account are essential prerequisites for investing in the Indian financial markets.
Now that you know what a trading account is, you need to understand how to trade online using a trading account.
Before you learn about the process, you should know that it may vary slightly depending on the stockbroker with whom you have the account. So, here’s a generic overview of the steps you would need to follow to trade using a trading account.
That’s it. Your buy order will be placed by your stock broker and sent to the stock exchange. The exchange will then attempt to match your buy order with a corresponding sell order with the same price as you’ve mentioned. If the orders match, they will be executed by the exchange. The units of the asset that you purchased will be credited to the demat account linked to your trading account within one day from the date of the transaction (T+1 settlement).
The process that you need to follow to sell your investments through your trading account is also very similar to the steps mentioned above. The only point of difference is that instead of clicking on the ‘buy’ option, you would need to select the ‘sell’ option. Once your sell order is executed by the exchange, the number of units of the asset you sold will be automatically debited from the demat account linked to your trading account.
You must now be aware of how to trade online using a trading account. But before you begin trading, here are a few things that you should know.
As an investor, you need to know how to trade online using a trading account. Since the process may vary slightly depending on the stockbroker you’re associated with, it is important to first get acquainted with the various features and the user interface of your trading platform. If you’re still unsure of how to trade online using your trading account, you can reach out to your stockbroker’s customer care for guidance and support.
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