Five things to know about trading securities smartly in the stock market

Here are five smart things to know about trading securities in the stock market:



1. The stock exchange is a regulated market for buying and selling securities. It is established under the Securities Contracts Regulation Act.

2. Under the Act, only registered members (brokers) of a stock exchange can buy or sell securities at a stock exchange.

3. Brokers set up trading platforms to enable investors to place their orders through them. Electronic orders are routed through the brokers to the exchange.

4. Investors should ensure that funds and securities required for their trades is available with their brokers, to settle a trade without default.

5. Brokers create 3-in-1 accounts where the trading, demat and bank accounts are linked, so that transactions in securities are smoothly executed.



(Content is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta)