Table of Contents

What is online share trading?

Online share trading is the new age and most relevant way of trading in share markets, which helps you trade in stocks, commodities, forex, bonds, ETF’s, futures on online platform. Almost all major brokers today provide online trading

 platform for their customers and clients. The traditional trading system involved calling brokerage firm for investing in market. The trader would order for buying of particular stock and when there is seller available for the price placed in order the exchange will procced with your order. Once, the order gets executed the broker will confirm you with executed details of the order with brokerage and other charges.

On the online platform the broker gives you an digital interface where in you get console of options of buy order, sell order, modify order. Set the stop loss, options for trading in delivery or margins and so on. It provides you an opportunity to trade in the markets directly and at lower cost. The online share trading is inexpensive and proven model of trading in current days and will be widely used going forward.

What is the difference between Investing and Trading?

Investing and trading define two types of market mechanisms which is used by market participants such a investors and traders. Both the mechanisms define different type of investing horizon, investing strategy and returns. Both of these participants have different objectives and features in the market.

Investing and Investors

Investing is a way of buying stocks in the capital markets which could yield an person a hefty and sound return over period of long time. It simply reflects the traditional Indian investment strategy of saving for long for better future. This involves in-depth fundamental research of stocks in which the money will be invested. People often look for a company who is at a early stage of growth and will be able to generate good returns over period of few years in coming future. Risk in investing is much less and mitigated as compared to trading. People who do investing with such long-term strategy are termed as investors. They invest in stocks for long term horizon and have objective of creating wealth over period of long term.

Trading and traders

Trading is totally opposite of what investing mechanism and thought process. Trading involves buying and selling of stocks, commodities, ETF’s at a very short horizon. It involves generating returns by riding over the risk of price speculation of particular asset in short period of time. Trading involves study of price movements, charts, technical analysis of the particular asset which you want to trade. Risk in trading is comparatively high than investing as price fluctuations and speculations cannot give returns every single time. People who follow above mechanism are termed as traders. They trade on stocks, commodities, currency and their price fluctuations and benefit a profit from it.

What is the difference between online share trading and offline share trading?

Online share trading and offline share trading are two parts defining the new and old way of trading. Online trading refers to a simpler way of trading which also less expensive and less clumsy. The online trading platforms offer you a better experience of trading with wide range of options regarding various options of order. Where as offline trading has only call option to broker office and place the order.

Offline services are also time consuming and could result into missing of desired price for trade as you have to call broker office and place the order which is of high inconvenience. Online trading offers trading at your fingertips with platforms available in mobile application format you can place order from anywhere in the world with help of internet.

Further, online transactions are under your control with respect to any transactions and orders you do. In offline trading broker or trader might misuse your money for some other transactions without your consent.

In terms of the data the online platform gives you everything on real-time basis. Where as the offline trading platform is not beneficial in terms of getting data and information and real-time basis. In offline trading time taken to know the information and placing the order is large in which someone with online platform can execute the order easily with ready and real time information available to him at his online terminal.

What are Online share trading platforms?

Online share trading platforms are interface on which a client can see his trading account details with regards to transactions, positions, profit & loss statements, market movements, etc. Such platforms are given by brokers or service providers with certain charges or some times free to carry out your online share trading activity. The rise of financial technology has led to tremendous change in the capital markets too. The new age brokers who are also known as discount brokers provide the online share trading services at a lower and competitive rate. These platforms also provide much more than just trading facility. The information on markets, stocks are much more useful and helps an investor to do his own research on stocks and markets which aides him doing investing easily. One can get the trading platforms by opening trading account broker who provides a seamless online share trading experience altogether. Online trading platforms also help you in applying for IPO’s of stocks, NFOs of bonds, etc. All together online trading platform is one stop solution for all the trading problems you face in your day to day trading life.

Online share trading tips, tricks and strategies

For any beginner in online share trading it its important to now how start with online trading and strategies should be in place when you start trading on your own. One should look for below tips while starting online share trading. Slow start will help you gain experience of the market movements and all ups and downs in the market. Risking all your money at the start is bad idea. Look for expert comments and strategies as a learning and try to improve yourself. After that one should do his or her own research of the market stocks before entering into the online share trading. Without a research it would prove to unpredictable about the journey of online share trading. One should also look for tools which help in enhancing online share trading. These tools are largely used by fellow traders on daily basis such as chartlists, stock screeners, watchlists, market reports etc. Although above measures will help you to start online share trading but, person becomes wiser with experience and experience teaches more things than any book would.

Benefits of online share trading

Online share trading definitely has larger benefits for the longer foreseeable future to come for investor community. It has eliminated many perils of offline share trading which proved to slow, costly and time consuming. Now, the investor community around the world has shifted to online share trading and reaps profits out of it. The benefits of online share trading are vast such as it eliminates middleman where you can directly put the order at your trading platform and execute the order, no broker person required for it. Secondly, since the middleman is eliminated the cost has also come down drastically in terms of brokerage and other charges. Thirdly, one can easily control their investments and know the value of their investments on real time basis. Which is very helpful in taking trading decisions quick and fast. Online share trading has more benefits than perils. If you don’t have your trading account. Open your trading account now.

what is fundamental and technical analysis in stock trading and how to do it?

To earn profits out of investing or trading one must do his own research to spot the best opportunity of investment. The research involves two facets of analysis i.e Fundamental analysis and technical analysis. Let’s take a look at in brief

Fundamental analysis - Fundamental analysis researches about stocks, industry, sectors and economy all together to spot an investment opportunity. When a analyst research stock using sectoral changes and drills down further is known as top-down approach and when a person looks at larger view of economy he starts with bottom-up approach. Fundamental analysis involves study of financial statements, macro-economic developments, global markets, etc. The fundamental analysis is mainly used to spot investment opportunities for long term.

Technical analysis - Technical analysis is used to spot investment opportunity for short term goals. Traders do extensive analysis of charts and trends of years to spot opportunity. It looks after the volumes of trades happening, monitoring weekly, monthly averages of price trend of the stocks, commodity, currency, etc. Trader or technical analysis contradicts with fundamental analysis as many stocks are opportunities wont fall into same territory after analysing in both ways. Technical analysis doesn’t look for valuations and financial statements, it looks after price charts for previous years and analyses it.

How to do online share trading?

During the traditional pre internet era an investor would call the trader or broker for a trade execution. Then the trader would confirm client id and then put the order with desired price level with stock exchange. Once the exchange identifies an order reciprocating the bid with desired price the order would get executed. After execution the trader would again call and give trade confirmation call to you. Such a long process used to take place while doing offline trade.

But now as we live in internet era, all the clumsy and time consuming things are eliminated and replaced with fast and secure online share trading. Just with few clicks you can place the order and get the confirmation there itself within seconds. This is the most important advantage of online share trading.

Step No.1- Open demat and trading account
You need to have demat and trading account to trade into stock market. Open demat account and trading account with trusted broker who is registered with SEBI, stock exchanges and has good track record or facilitating trades.

Step No.2- Learn the basics of stock market
One cannot dive into swimming pool before knowing the basics of it, in a similar way one cannot directly start trading after opening demat account. One should know what are stock markets how they work, what are shares and other investment assets, etc. You can get the basic knowledge with brokers as well as on internet and start with learning the basics of it.

Step No,3- Practice with paper trades or simulators

Before directly putting your money at risk, you can practice trades with your knowledge on paper or on online platforms by just playing it like a game. Paper trading is basic and major step towards becoming usual investor in future. Note down your recommended price and target price on paper and see how many times you achieve target price and how many times you miss it. It will help you in giving clear picture about your knowledge and experience.

Step No.4- Start with small amount
Once you are ready with practice and have gained significant confidence of dealing with hits and misses of your trades you can start online share trading by investing small amounts in the capital market.

Step No.5- Plan your investments
Now that you have become active in investing and trading online, you must plan your portfolio with respect to risk you can take. An aggressive investor can take high risk while a conservative investor will take lower risk. Sometime people mitigate risks by dividing the exposure to high and low risk equally by taking moderate risks.

Apart from this, above steps do not guarantee success in markets, but provide you handful guide to for planning your investments.

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