\u201cYes Amit, but before I go on explaining the trading account to you, I hope you remember the debit card analogy I had drawn last time we met?\u201d<\/p>\n
\u201cYes\u201d, replied Amit.<\/p>\n
\u201cCool, so like I said, a trading account is essential to transact on your demat account, just like you need a debit or credit card to transact on your online banking account. To buy and sell securities online, you need to have 3 essentials in place\u2026.\u201d<\/p>\n
\u201cFirst, is your demat account, to serve as a repository of the securities you have bought or sold. Second is an online banking account, to enable you to make payment for the purchase of securities, and to receive payment for any sale of securities. And, third is your trading account. Trading account is that mechanism that helps you to transact in shares & other securities, online. It is also sometimes referred to as an online investing account.\u201d<\/p>\n
Megha exclaimed, “Yes! I know this. You\u2019re talking about that 3-in-1 account<\/strong> that banks are offering these days, right?\u201d<\/p>\n \u201cYes Megha\u201d, I responded with a smile, \u201cexcept that I am not selling such an account to you!\u201d<\/p>\n \u201cSee Megha, this 3-in-1 account is a convenient way for the investors, and a more profitable way, for most bankers. It includes an online banking account, a demat account, as well as, a trading account.\u00a0 It is like a win-win situation, for both, as it provides convenience to the customers in the form of all 3 accounts at one place, as well as, increased business to the bank by the sale of a bouquet of services, together.\u201d<\/p>\n Rachita probed, \u201cSo which company should I open my trading account with?<\/strong>\u201d<\/p>\n \u201cRachita\u201d, I said, \u201cthat would depend on 2 things, primarily: I started telling them the different charges, when Rachita said, \u201cSurbhi, that\u2019s getting too confusing. Can you write it down for us somewhere?\u2019<\/p>\n \u201cOf course\u201d, I said, \u201cHey Prashant, can you please pass that tissue, so I can give Rachita a better idea about the kind of charges she would be facing in the event of opening such an account.\u201d<\/p>\n \u201cHere and here\u2019s my pen\u201d, said Prashant, passing the pen along-with tissue, knowing very well what I would have asked of him next.<\/p>\n So, I quickly drew them up a chart with the comparative rates I had in mind for an equity shares trading-cum-demat accounts.<\/p>\n \u201cBut\u201d, I added, \u201cdo remember to inquire from your banker or broker about the best deal he can offer to you , because the intraday brokerage and delivery brokerage charges are generally negotiable, and tend to decrease for\u00a0 higher value trades.\u201d<\/p>\n \u201cI think I know what you all want to know next\u201d, I continued, \u201cwhat are intraday brokerage and delivery brokerage charges?<\/strong>\u201d<\/p>\n \u201cVery simply put, intraday brokerage is the amount you pay on the trading amount of your purchase or sale of shares. It applies only to those trades that settle in a days\u2019 time. Where, you wish to hold the shares for any period longer than a day, the delivery brokerage charges will be applicable, which are 5 to 10 times the intraday brokerage charges.\u201d<\/p>\n \u201cWhat if I want to invest in debt or mutual fund schemes?<\/strong>\u201d questioned Ankur.<\/p>\n \u201cIn that case\u201d, Ankur, \u201cyou simply have to ask your broker to add that account to your current account, and you may begin buying and selling other securities, just like you were buying and selling equity shares. The brokerage charges, however, will be different in such case, and, generally on a higher scale. But, you can view your total investment in various asset classes, all at one place.\u201d<\/p>\n \u201cLet me give you a checklist to consider while choosing an online investing account\u201d, I continued, pulling together another tissue to scribble on.<\/p>\n Amit finally seemed satisfied to have most of his queries relating to online investing resolved. Well! It was time to honor our dinner reservations.<\/p>\n By now, each of my friends seemed convinced about the advantages of an online demat-cum-trading account.<\/strong><\/p>\n They were more confident with respect to using an online demat & trading account to our benefit, for easier, safer, economical and more convenient investing.\u00a0 And I was happy to be able to help them being the financial geek of the group.<\/p>\n But what I now know is that we were going to have many such discussions once my friends started investing!<\/strong><\/p>\n If you liked what you read and would like to put it in to practice Register at MoneyWorks4me.com<\/a>. You will get amazing FREE features that will enable you to invest in Stocks and Mutual Funds the right way.<\/p>\n Need help on Investing? And more<\/b>\u2026.<\/b>Puchho<\/b> Befikar<\/b><\/span><\/p>\n Kyunki<\/i><\/b> yeh<\/i><\/b> paise<\/i><\/b> ka<\/i><\/b> mamala<\/i><\/b> hai A lot can happen over a cup of coffee! The Caf\u00e9 Coffee Day punch line could not have been more apt! From harmless college gossip to strategic business decisions, this beverage has seen it all. And so we did discover, last week during our discussion on Demat accounts.<\/p>\n It is now time to engage in another such fruitful discussion. So grab a cup of coffee and join me and my friends in this conversation!<\/p>\n","protected":false},"author":15,"featured_media":20421,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"no","_lmt_disable":"no","footnotes":""},"categories":[1154,1151],"tags":[432,754,752,753,735,737,750,288,48,49,120,64,751,81,209,83,1142,305,84,85,736,749],"modified_by":"MoneyWorks4me","_links":{"self":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/7211"}],"collection":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/comments?post=7211"}],"version-history":[{"count":1,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/7211\/revisions"}],"predecessor-version":[{"id":20422,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/7211\/revisions\/20422"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/media\/20421"}],"wp:attachment":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/media?parent=7211"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/categories?post=7211"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/tags?post=7211"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nOne, the type of account you wish to open, which means, do you want to invest in just equity or do you also want debt, mutual fund, and \/or commodities in your portfolio, and two, the charges applicable on the purchase and sale of securities.\u201d<\/p>\n![\"Comparison](\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2012\/10\/Trading-Account-Charges.png\" "\\"\\"")
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