SHARE TRADING BASICS

Share investment is seen as a way to grow your income. While the market is risky, there is no doubt you can grow your wealth if you stay invested in the market for 5-10 years.

Long-term investments have proven to be successful. In fact, many studies suggest that these investments can bring higher returns than gold and property investment.

The share market is volatile, which means the price of the stocks keeps fluctuating on a daily basis. Usually, investment is considered as a way to save some money for your retirement and future goals.

You put some money into the growth of a reputable company and make profits in the future. However, there is no guarantee the value of the shares you have purchased from a company will witness a growth.

The share market can be defined as a centralized platform where buyers and sellers gather to make trades. It involves the same day trading or long-term holding. Investors can either sell shares on the same day they purchased them or hold on to these stocks for years.

The longer you keep the shares, the more returns you are likely to earn from the investments. In fact, there is no maximum limit as to how long you are allowed to keep the shares of a company.

Understanding the Share Market Investment

Before you enter the stock market, it is important to gather information about the popular stock exchanges in India.

BSE and NSE are two of the most popular stock exchanges where a number of companies place hundreds of thousands of shares on a daily basis. These shares are then purchased by individual investors.

The purchase and sale of shares are no different from the sale of commodities.

However, it is a little complex and volatile. The value of the share increases when the company makes profits. The growth of the company can result in the increasing prices of the shares.

That’s how the investors make a profit. They purchase the shares of a company when they are sold at the lowest price and sell them when the price increases.

Intra-day traders sell the shares when they notice even a small hike in the price. Long-term investors, on the other hand, hold the shares for several years. The small fluctuations in the regular prices of the stock do not affect their investment decision.

Note that the income from the share market is subject to tax. Long-term gains involve a fixed 10% of the tax on the income that exceeds INR 1 Lakh. Short-term gains involve a 15% tax on the income earned from the sale of the shares.

As simple as it sounds, the share market can turn out to be a complicated industry for beginners. If you are new to this market, chances are you will have no idea when to enter and exit the investment. One of the biggest mistakes is entering the stock industry when you don’t know how to control your investment.

Setting up an account on an online share trading platform will not suffice. In order to start making money from this industry, you are supposed to understand your risk appetite and investment goals.

Online Brokers

You can hire a full-service broker to get a complete trading guide. As the name suggests, these brokers offer you financial advice, healthcare and retirement plan, and the basic information related to the share market.

Now that they offer a comprehensive package, they charge a substantial fee from the clients. Mostly, professional investors hire full-service brokers.

Nowadays, people opt for Robo-advisors to get started with share trading. The fund managers or brokers complete share transactions on behalf of the client.

Gill Broking makes your Share Investment & Trading Experience simple with major exchanges like NSE & BSE.

Open Trading Account Now @ https://www.gillbroking.com/open-an-account/

 

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The Share Market A Guide to Trading (2)

The Share Market: A Guide to Trading – Gill Broking

It is, therefore, important to learn both the pros and cons of intraday trading to get a better idea of how this market works and how exactly you can grow your money. In this post, we will walk you through a few advantages and disadvantages of intraday trading. So, keep reading to learn more.

• Beware of fixed/guaranteed/regular returns/ capital protection schemes. Brokers or their authorized persons or any of their associates are not authorized to offer fixed/guaranteed/regular returns/ capital protection on your investment or authorized to enter into any loan agreement with you to pay interest on the funds offered by you. Please note that in case of default of a member claim for funds or securities given to the broker under any arrangement/ agreement of indicative return will not be accepted by the relevant Committee of the Exchange as per the approved norms.
• Ensure that pay-out of funds/securities is received in your account within 1 working day from the date of pay-out.
• Be careful while executing the PoA (Power of Attorney) – specify all the rights that the stock broker can exercise and timeframe for which PoA is valid. It may be noted that PoA is not a mandatory requirement as per SEBI / Exchanges.
• Register for online applications viz Speed-e and Easiest provided by Depositories for online delivery of securities as an alternative to PoA.

• Do not keep funds idle with the Stock Broker. Please note that your stock broker has to return the credit balance lying with them, within three working days in case you have not done any transaction within last 30 calendar days. Please note that in case of default of a Member, claim for funds and securities, without any transaction on the exchange will not be accepted by the relevant Committee of the Exchange as per the approved norms.

• Check the frequency of accounts settlement opted for. If you have opted for running account, please ensure that your broker settles your account and, in any case, not later than once in 90 days (or 30 days if you have opted for 30 days settlement). In case of declaration of trading member as defaulter, the claims of clients against such defaulter member would be subject to norms for eligibility of claims for compensation from IPF to the clients of the defaulter member. These norms are available on Exchange website at following link: NSE, MCX

• Brokers are not permitted to accept transfer of securities as margin. Securities offered as margin/ collateral MUST remain in the account of the client and can be pledged to the broker only by way of ‘margin pledge’, created in the Depository system. Clients are not permitted to place any securities with the broker or associate of the broker or authorized person of the broker for any reason. Broker can take securities belonging to clients only for settlement of securities sold by the client.

• Always keep your contact details viz. Mobile number/Email ID updated with the stock broker. Email and mobile number is mandatory and you must provide the same to your broker for updation in Exchange records. You must immediately take up the matter with Stock Broker/Exchange if you are not receiving the messages from Exchange/Depositories regularly.

• Don’t ignore any emails/SMSs received from the Exchange for trades done by you. Verify the same with the Contract notes/Statement of accounts received from your broker and report discrepancy, if any, to your broker in writing immediately and if the Stock Broker does not respond, please take this up with the Exchange/Depositories forthwith.

• Check messages sent by Exchanges on a weekly basis regarding funds and securities balances reported by the trading member, compare it with the weekly statement of account sent by broker and immediately raise a concern to the exchange if you notice a discrepancy.

• Please do not transfer funds, for the purposes of trading to anyone, including an authorized person or an associate of the broker, other than a SEBI registered Stock broker.

• Do not deal with unregistered intermediaries (who are not registered with SEBI/Exchanges).

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