Trading in Equity Market
Trading in the equity market can be an overwhelming task, especially if one is not clear with the equity trading basics. These include:
- Equity markets
If the company is issuing shares for the first time (through an Initial Public Offer), it is known as equity investment through the primary market. Once the IPO is closed and shares are allocated, the shares get listed on the exchanges. Subsequently, trade (buying or selling) takes place in the secondary markets i.e. stock exchanges. Exchange based equity trading in India is available through NSE (National Stock Exchange) and BSE (Bombay Stock Exchange).
- Forms of equity trading
Equity Trading can take place in two forms-
- Spot (or cash) market
- Futures market
- Settlement cycle of trades
Indian exchanges follow a T+2 cycle for settlement of trades. Within two days of the trade being executed, the buyer receives the shares (credited in his/her demat account) and seller gets the proceeds in the bank account (which is linked to his/her trading account).
How to trade in Equity?
In order to start your equity trading journey, you need to get in touch with a broker or broking firm. Your broking partner will help you to open a Trading and Demat Account, which are pre-requisites for equity trading in India. Trading Account is the account through which you can place your equity trading (buy and sell) orders. Demat Account is the bank for your shares and investments. It holds your shares in a digital or dematerialized format. TradeSmart offers you the facility of opening these accounts at extremely nominal charges.
A good broking partner can radically change your trading experience. They not only help to execute your trades but also support with analytics and data to take the right decisions. TradeSmart has one of the best equity trading platforms in the country. Some things that to keep in mind before you trade in equity-
- It is important to clearly chalk out your risk parameters. Outline how much is too much (trading losses).
- Set your “stop loss” and “profit targets”. The first will be your insurance against volatility and the latter will help you churn the capital effectively.
- Do not lose focus from the associated costs (brokerage, statutory charges, etc.)
- Do not fall for market “hot tips” or rumors without in-depth research of your own.
Trade in Equity Market with TradeSmart
TradeSmart is your one-stop solution for your online trading needs (equity, future and options, currencies as well as commodities). While there are numerous equity trading companies in India, here is why you should trade with TradeSmart
Tradesmart makes use of cutting-edge technology to streamline processes, lower transaction costs and create a delightful investor experience. It has one of the best online equity trading platforms. Our offerings such as advanced real-time technical analysis, trading calculators, instant online fund transfer help to devise a robust equity trading strategy and stay on top of the curve.
- Trade on the move
TradeSmart’s services can be availed even when you are on the move. The trading app or the portal can be accessed from multiple mediums such as smartphone or desktop.
TradeSmart ensures highest levels of security for your stocks. Customer’s securities are only maintained in their respective demat accounts and not any pool account. Moreover, there is no conflict of interest as TradeSmart’s sole business is broking services.
- Lowest brokerage
TradeSmart’s equity broking services have been designed in a way to suit varied types of trades and equity trading(online) needs. The brokerage plans are not only economical but also flexible to accommodate all trading needs.Click here to know more details about TradeSmart pricing.
- No forced selling
Unlike many other trading companies in India, TradeSmart has in place a zero-forced selling philosophy. The team does not trade (on client’s behalf) without consent. Also, they do not work on an incentive model (for brokerage generated) and hence have only the investor’s best interests in mind.
These two terms are used interchangeably in the Indian investment parlance.
The following supporting documents are required:
- PAN Card
- Address and Identity Proof (Such as Voter ID Card, Passport, Driving License etc.)
- Cancelled cheque and bank statement (last six months).
Equity tradingin India (on the stock exchanges)happens between 9.15am to 3.30pm on all working days. The trading is open from Monday to Friday.
Keep these points in mind while making your equity trading strategy –
- Make trend your friend
Try to stick to the market sentiment and trends, especially when you are just starting off. Going the opposite way (also known as contrarian bets) spikes up the risk quotient significantly.
- Intrinsic or real valuation
In the equities world, it is important to understand the true or intrinsic value of stocks.Everything that shines, may not be gold.
- Understand intraday trading</b >If you wish to optimize your trading results, it is important to understand how intraday trading works. <
- Think from a long-term perspective
Equity markets are known to be volatile, especially in the short run. Hence, it is better to have a long-run view for your trades