When investing in securities, especially stocks, you must open a Demat account first. By now, you may have heard of Demat accounts, even if you do not have one. Opening a Demat account is a mandatory first step in trading in the securities markets. This may be linked to a trading account. Before you know more about these accounts, you must find a broker or a registered depository participant to access the appropriate resources to aid you in opening Demat and trading accounts and ultimately help you undertake trading transactions on the stock market.
Understanding Brokers and Trading Platforms
Nowadays, most processes are online and completely digital. If you want to buy and sell stocks, for instance, you must choose an online broker and open Demat account. This is an electronic account that stores your securities and is linked to a trading account that helps you make trading transactions (buying and selling shares).
A brokerage platform or a trading platform is essentially a brokerage service that facilitates your buying and selling of securities and the storage of these. This is a purely online and digital platform that connects ordinary investors to exchanges and helps them to invest and trade online. A trading broker platform may be in the form of a web or mobile application and can be accessed from anywhere at any time. Most reputed brokers are those who are registered and help you to invest in stocks, mutual funds, derivatives, bonds, and more.
Brokers also aid investors in investment decisions by providing facilities like resources and margin trading services. When you open a Demat account and open a trading account with a broker online, you are ready to start your trading and investing adventure. However, there are some key factors to consider while choosing the broker suited to your needs.
How to Choose a Broker Platform
Keeping up with the competition is the key to making any brokerage platform successful today. Each brokerage platform offers you different services and enables you to have exposure to an array of investments. Making an appropriate choice may be like finding a needle in a haystack, but if you consider the following factors, you may find a broker that matches your unique financial requirements:
- Available Accounts
Today, most leading brokerages offer you the facility to open a Demat account with linked trading and bank accounts so your transactions while trading are smooth and hassle-free. The Demat account opening process is typically a free service once you sign up with a registered broker.
- Charges for Brokerage
When you open trading account that is connected to your Demat account, the processes to start these may be free. However, advanced brokerage platforms do charge you to use their services, and these fees vary from one broker to another. Transactions that you make via their brokerage platforms are charged, and since there is a range, you should consider these diligently. You may want to balance a brokerage platform’s services with its fees so you get one that charges you fees that do not eat into any potential profits you make in your trades. Charges comprise those for maintenance, transactions like deposits and withdrawals, and other charges like interest for margin trading facilities, for instance.
- Securities and Facilities Available
Before you sign up with a brokerage platform and open a Demat account, you may want to consider the securities offered for investment by the brokerage platform. There are reputed trading platforms that offer a range of financial instruments and securities from mutual funds to stocks and bonds. Trading platforms also offer you instruments like ETFs and facilities for trading in commodities.
Besides the securities themselves, some trading platforms offer you attractive methods of investment like margin trading facilities that make your trades possible with limited funds.
A Workable Interface
Trading platforms are very different from each other and each brokerage is unique. However, there are different types of investors from senior citizens to youngsters and platforms have to be versatile enough to cater to various users. Any successful trading platform’s user interface needs to be highly responsive and intuitive. Whether any activity is undertaken, be it to open a Demat account or opt for margin trading, the user interface must be interactive. Investment should be a convenient activity and trading platforms these days are equipped with tools and resources to make investment as easy as possible.