Key Points to Consider While Opening a Trading Account Online

If you are thinking of making a quick buck by trading in financial securities or a long term investor thinking of investing in the stock market, you will need a trading and demat account to put that process into action. Assuming, you already know which stocks, mutual funds, bonds to buy; now you need to know how you can buy those securities. For that cause both of these accounts plays an important role for you, and without anyone having either or neither of them, one cannot buy or sell stocks in the equity market. So, in order to open these two accounts, all you have to do is perform an account opening process with a  stock broker by going through a 10-minute KYC process and providing certain government-certified documents.

Why Do You Need A Demat Account?

Just like you hold your money in your bank account, likewise, in a demat account you can hold the stocks you have bought from the stock market. All the securities with a unique identification number are visible in the demat account with the number of stocks you hold at a time.

A demat account is linked with a trading account and when you buy or sell a share adjusted are made accordingly in both account. Process in background goes like this, transaction made during the day are recorded in the trading account and debit or credit of share is reflected into the demat account after T +1 or 2 settlement days as per the rules and regulations of trading settlement cycle.

Why do you Need a Trading Account?

A trading account provides you the platform to buy and sell securities in the stock market. This means every buying and selling-related transaction is recorded in your trading account. When you place a buy or sell order, it is recorded in your trading account and you can check the statement of your trading account anytime. However, your broker will send you a copy of the statement every month. So, let's find out what factors you should consider while opening a trading account in India.

Points to Consider Before Opening a Trading Account:

#1 Account Opening Charges & Fees

Everyone wants to save themselves from paying out money for thing that can be settled by sitting on the table. You can see many ads offering free trading accounts or when you ask to open a trading account with a broker, you can be offered freely with the demat account or both accounts can be opened freely.

But believe blindly in such ads or freebies, as there could be some hidden charges or the broker might ask you to pay the annual maintenance charges or levy the charges on every transaction. You need to verify and confirm such charges before opening the trading account. If any charges or fees are levied be ready to pay or make it clear with your broker if they are going to be charged later on.

#2 The User-interface of the Trading Account

As you know trading account is used for buying and selling stocks. And you can check your trading transactions anytime as per your ease. So, check the user interface of the trading account, whether is it user-friendly or not, do you face any kind of technical issue while checking for the transactions etc.

Similarly, there are many things like there should be options to customize the view of checking the transactions and various other details like stock price, market data, and your linked demat account status and bank account etc. Everything should be simple to use and easy to access making it easier for the end-users, even people who are not tech-savvy or not habitual of such things.

#3 Trading Platform Features for Trading Account

In the age of digitalization, you can have the aces to your trading and demat account on your computer, laptop or smartphone. You can use your trading account yourself to buy and sell the shares directly from the market. Hence, apart from basic features what are the additional features your trading platform is providing while using the trading account?

There should be market data with live feeds or stock prices and market-related other information. You can check the technical charts from popular charting software like Trading View, the latest bidding quotes and financial data or the company.

Apart from there are many things you need while trading in the stock market, and all such data you can get in your trading account. These keys are important to analyze the market or individual stocks and make quick decisions about buying and selling.

#4 Security and Safety of the Transactions

This is one of the most important factors you need to consider or thoroughly check before opening a trading account with your broker. Yes, the safety of your trading account and the security of your transactions are very important to keep your investment secured and protected from unauthorized access.

In the age of excessive use of digitalization, cybercrimes are also on high levels. Hence, you also need to be very careful about your digital accounts. So, please check the security levels of your trading account, like the account login verification process, accessibility at your broker end and the trading platform in which you will use the trading account is secured and protected from such cyber threats. Make sure security layers while opening the online trading account for a safe trading experience.