Remember to prepare the documents before opening a trading account
A demat account can help you trade seamlessly across multiple market-related segments. However, you must have the assistance of an online brokerage platform or a DP to open a demat account. A demat account holds your securities in electronic format. You can also buy and sell securities from a demat account because a trading account is linked to it. You must provide these documents to open a demat account with a e-commerce in india:
- Identity proof: Driver’s license, passport, voter card, PAN card or Aadhaar card may be submitted to validate your identity when opening a dematerialized account.
- Proof of address: An electricity bill, water bill, ration card, telephone bill, passport or bank account may be submitted to validate your address.
In addition to these documents, you must submit financial documents such as payslips, Form 16 and passport size photographs. Although it is necessary to go through an in-person verification to complete the verification process, some brokers allow you to complete this process through an online video verification.
It is necessary to keep all the documents ready because many brokers offer a simple online process to open a demat account. The simple online application process allows you to open a demat account in a few minutes. However, the verification process may take longer and your demat account will be activated within a few days.
Once you have submitted the application form and documents and completed the necessary formalities, you will be assigned a unique 16-digit beneficiary identifier. Along with this, the login information will be sent to your registered email address and mobile number. You can login to your demat account and start using it for trading and investing purposes. As a beginner, you can adhere to these guidelines and tips when trading:
Know the basics of the stock market
Knowing the basics of the stock market is important before taking on any trade. The basics include how stocks, mutual funds, currencies, and other securities work. Understanding the fundamentals of stocks to assess their value is also important for making profit without taking too much risk.
Like all other types of instruments, market-linked instruments also offer good returns if you diversify your investment portfolio smartly.
For example, if you want to trade both delivery and intraday, you need to know how to identify the best performing stocks in the market. The average monthly movement can be a way to determine the recent performance of a particular security.
However, as the market is influenced by a variety of geopolitical, economic and other factors, you should be aware of the latest international and domestic affairs and important events.
After identifying the best stocks for trading or investing, you can buy them. Ideally, you shouldn’t buy stocks in bulk unless they’re doing very well. Continue to monitor the movement of stock prices and buy stocks after each significant movement in their price. This will help you average the moving prices so that any upward movement will bring you a decent profit.
Compare application fees
A demat account is associated with several chargers like AMC, brokerage or transaction fees, transfer fees, custody fees, etc. You need to know about all these fees in advance. Moreover, comparing the dematerialization fees of several stockbrokers before opening a dematerialization account will help you save brokerage and earn high profits.
(To note – This article is not written by the Fox Interviewer editorial team, nor by the author)***