Stock market investing is mainly a long-term procedure that helps to manage the funds of investors properly. Though for the beginner, it might be time-consuming process to learn about investing in the stock. But slowly and gradually when a person starts doing it with proper understanding, they become expert in this field.
There are mainly two reasons that people prefer to do securities trading:
- One is that it provides the investors with a high rate of return
- Secondly, the financial discipline of the person gets maintained
After the complete research and analysis, it has been believed that doing investment in the shares provides a high rate of return as compared to the investment in the fixed deposits. Before doing any investment in the stock market, a person should get the platform's details.
What is the stock market?
In general terms stock market is the place where the trading of financial instruments like stocks, bonds, and commodities is done. There are mainly two essential stock markets that the people prefer: the national stock exchange (NSE) and the other is the Bombay Stock Exchange (BSE). Not only are these the available option, but there are other available options, but the investors' priority are these only.
All the activities that are taking place in the various stock markets are managed and regulated by the Security Exchange Board of India.
How to do the investment in the stock market?
It is not the case that a person can directly buy and sell the shares in the stock market. The investor will first of all have to hire a broker who will be an authorized person to do the trading in the stock market. The procedure to start with the investment includes:
The investor will have to open an account to start with the investment. The account will either be opened with the broker or the stock brokerage platform. This is an account used to buy and sell shares.
Then the broker or the stock brokerage platform will open the Demat account for you.
This account will just be linked to the bank account.
To open the trading account, the investor will have to add the details related to knowing your customers. This will include the verification of the essential documents.
Most of the reliable brokers providing securities trading facilities also provide the option of online KYC to the investors.
Now a person can feel free to start with the trading either through the online or the offline mode.
Various costs to invest in the market
There are a few different types of the cost that the person will have to bear while investing in the stock market:
- Transaction cost
As the broker's hiring is done, the person will have to pay the brokerage. Apart from the brokerage, they charge other taxes like the security transaction tax.
- Demat charges:
The brokers do not operate Demat accounts; the NSDL operates them. Therefore, the person who is opening the Demat account will have to pay them a minimal sum of money. The range of these charges is between 100-750 rupees.