Every investor or trader who wishes to buy securities on the stock market must have a training account. A trading account, also known as a Demat account, serves as an online platform that allows investors and traders to buy and share securities online. A user selects from an extensive range of securities, places a buy order, and obtains the necessary securities in his or her Demat account which makes the overall process of stock market investment hassle-free and convenient. All the securities bought and sold are stored in a dematerialized format through the use of a trading account platform. Moreover, a trading account is categorized into two types:
- Securities trading account:
Securities trading account serves as a simple training account that is used for buying stocks, mutual funds, and ETFs online.
- Commodity trading account:
Apart from securities, dedicated commodities are also bought and sold online including gold, crude oil, and silver. Investors, therefore, require a commodity trading account through which they can buy and sell commodities online.
There are various types of benefits that an investor receives upon opening a trading account. We have enumerated some below that can help you understand the necessity of a trading account:
- Hasslefree access to securities:
A trading account serves as the only means in the 21st century that can allow investors and traders to buy and sell securities online. Securities listed on every type of stock exchange, whether primary or secondary, can only be invested in through the use of a trading account. An online trading account makes the whole process of investment completely hassle-free and convenient.
- Access to necessary information:
The online trading platform serves as a great way for traders to obtain necessary information about various stocks and happenings around the world. Modern-day trading accounts and platforms deliver all the necessary information like price regulations and stock news that or a sensual for the traders. The price movements, stock information, company performance, and all the necessary information are made available online through trading accounts.
Traders receive an extra added benefit as they can easily buy and sell securities through a trading account from anywhere. One can easily access a trading account through the use of a laptop and even a smartphone which makes the overall process of trading or investment hassle-free.
How to open a trading account?
A trading account can be easily opened by completing all the necessary KYC formalities. One has to select a certified broker who possesses the necessary permission from SEBI for opening trading accounts. Every bit of personal information like PAN number, bank account details, and all the details must be made available. The overall process of opening a trading account in the 21st century has been made completely online and paperless.
There are generally no charges for opening a trading account. However, extra charges are applied for various forms of investment like futures and options trading, commodity investment, and intraday trading.
Dematerialization of shares has enabled the creation of online demat/trading accounts which has benefited traders all around the world. Every aspect concerned with trading and investing in the stock and commodity market can be easily handled through the use of such a trading account.