Share Market Basics: Learn About Trading and Stock

  With the advancement of technology, now trading in the stock market has a different mechanism. Gone are the days, when the investors bought the securities of the companies in physical form and then transferred to another shareholder again in the physical form. Now the buying, selling, and transferring of the securities can be done in the digital format. After the Dematerialization Act, 1996, the Indian Government and SEBI have initiated the use of digital platforms to hold securities. Now the investors are only required to open a digital account with any broker that provides the services based on some fees and subscriptions. Usually, all brokers provide the account open facility at the least cost. opening an online trading account has various benefits like reduction of risk of theft and unnecessary space, delay transfer of securities between the participants. Along with the benefits, it includes different challenges and problems that are encountered by the investors while openin...

A steady rise in the number of individual investors in the stock markets has been a trend of late. Unlike earlier, these investors are no more only from metropolitan cities. They now belong to even small and remote cities and towns. The advancements in online trading with the help of digital technology have improved the access that investors have to the capital markets. However, things were not the same earlier.  Physical certificates were given to the investor for every investment and these physical copies had to be produced every time to make a claim or transaction on these certificates. This paper-based system of trading in securities wasted a lot of time and was vulnerable to errors, frauds, theft, and damage. The Securities and Exchange Board of India introduced the Depository Act, 1996, which provides for the electronic bookkeeping of shares. This act paved the way for the establishment of depositories and made the dematerialization of the physical certificates possible....

With the introduction of the Depository Act, 1996, the Securities and Exchange Board of India has made it mandatory to execute trading in the stock market through digital mode only. The Depository Act has introduced a dematerialized system for trading in stocks, bonds, government securities, and other types of securities. Prior to dematerialized trading, stock exchanges offered investment opportunities with physical and paper from securities.  Technological advancement has made it easy for investors to participate in the stock market without any hassle. Multiple parties play an important role in trade statements that usually operate on the ‘T+2’ days system. These participants include issuing companies, stock exchanges, brokers/depository participants,  depositories, and investors.  Under the digital investment system, you need a platform that will hold your financial securities along with digital trading. The Dematerialization Act has provided the concept of Demat accoun...