Demat account is the account that is necessary for all the investors or the traders before they start there trading or investing in the stock market.
Through this article, you will get to know about the definition and the importance of the demat account.
Let’s start with the definition:
Demat account is an account in which the individual who are investing or trading in the stock market used to hold the shares and the securities as this is an electronic platform to hold the shares or securities.
The full form of demat account is a dematerialized account.
The main purpose of opening the demat account is to hold shares that have been bought for making share trading and investing easy for the users using the online facility for trading.
In India, you can get all the depositories services and facilities by the National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL) with the help of the stock brokers, intermediaries or depository participant.
The charges of Demat account will vary as per the volume held in the account, terms and conditions laid by the depository and the stock broker.
This account provides the facility to hold the shares and securities in an electronic format.
A demat account holds all the investments and securities that an individual makes in the shares, government bonds, exchange traded funds, mutual fund and many more types in one place.
So, this was the discussion about the demat account.
Now, we will talk about the dematerialization as it is the full form of demat account.
Dematerialization is the process in which it is used for converting the physical share certificates into the electronic form.
Any trader or investor who want to do the trading or the investing part in online need open a demat need with the depository participant or can also approach the stock brokerage firms that are available widely in India.
Trading in simple language it is to buy or sell goods & services in short term duration to earn the profit. In terms of stock market in India purchasing and selling of shares based on technical evaluation or market trend for short term duration for making money is called trading.
The dissimilarity between investor and trader is investors invest money for the long term and wait for the bull run to make benefit while trader make gain even in bad market circumstance sounds interesting. The trader can make more money than investor hence many people try this trick to make more money but fails. Trading is a mind game. This game is not for faint-hearted. To become a successful trader safely, they must take care of several things.
When anyone wants to trade, they use a broker who will execute the trade on the market. The broker they opt for is an essential investment decision. India presently has around 70 brokers to option between. However, there are numerous top global brokers they can turn to.
Criteria to choose broker for trading in stock market in India
What Can Be Traded in stock market in India
If they need to branch out from the National Stock Exchange of India and the Bombay Stock Exchange, they can trade in other global markets. If they are S&P 500 day trading, for example, they will be buying and selling the shares of companies, such as Starbucks and Adobe.
In the day trading forex market, they will be trading currencies, such as Indian Rupees, US Dollars, Euros, and GBP. In the futures market, often based on commodities and indexes, they can trade anything from gold to cocoa.
Index funds rapidly occur in financial advice these days but are slow financial vehicles that make them unfavorable for daily trades. These are usually preferred for long-term investment plans.
Another growing part of the interest in the day trading world is a digital currency. Equity trading with Bitcoin, LiteCoin, Ethereum, and other altcoins currencies is a widening business. With lots of volatility, able eye-popping returns, and an unpredictable future, day trading in the cryptocurrency could be an exciting avenue to pursue.
Day Trading Strategies in stock market in India
Traders will employ day trading strategies in forex, grain futures and anything else they’re trading in, to give them an edge over the market. Day trading using the Gann method is particularly famous in India, for example. It’s while that tiny edge that is all that separates successful day traders from losers.
There are several day trading methods out there, but all will rely on accurate data, carefully laid out in charts, tables, and spreadsheets. Options include:
It is those who stick religiously to their trading strategies rules and parameters that often seize a slice of the 3 crores daily turnover in the Indian National Stock Exchange.
Trading in any of the market segment has a high risk associated with it and therefore it is very important to know the amount of risk that you can bear in the market. These is usually done by getting your risk profile analysis before entering the market or planning any investment. Your broker or a certified investment advisor can help you calculate your risk profile analysis. The Risk Profile Analysis usually varies with several factors including your income, liabilities and your age. Therefore, you should keep your risk profile updated.
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