How to Start Equity Trading in India

How to Start Equity Trading in India

Trading is an old concept in India. Since the inception of the Bombay Stock Exchange in Mumbai, many people started to invest their huge amount of shares and generated strong income from it. As time passes, few of many stopped their trading due to inconsistencies and fluctuation in the stock market. They made their theories related to the stock market such as the stock market is full of risks.

However, the case is somewhat different from what they thought. Equity trading is now becoming popular among Indians especially youngsters. The principal reason behind the sudden popularity of share trading is “positive investment returns” with minimum hassle.

Earlier trading was done manually in the stock market. People used to go through a lengthy documentation process which was quite tedious. Nonetheless, online stock trading is a much easier way to trade online.

To trade online, you need to open Demat account where you can perform buying and selling of shares in a hassle freeway. The Demat account simply means the dematerialization of shares. In other words, it is a place where you can hold your shares, trade shares online.

Types of Trading in Indian Stock Market

There are two types of trading in India. Intraday trading and delivery trading. In intraday trading, people have to square off their position before the market session ends. I.e they have to buy or sell their shares in a single day.

Delivery trading, on the other hand, refers to the trading which extends more than one day. Also, delivery trading allows you to buy shares and retain them for a longer period. The time period of holding stocks can be a few days, weeks, months, years.

Although the brokerage of delivery trading is higher than intraday trading, the chances of loss are very less than intraday trading.

Steps to Start Stock Market Trading in India

    • Open a trading and Demat account through any brokerage firm.
    • Link your trading account to your bank account for the transaction process.
    • Select the right investment broker. Make sure that the brokerage company is registered with SEBI.
    • Initially, start with low-risk stocks.
    • Manage your risk profile and set risk quotients.
    • Diversify your portfolio and start investing.

Methods to Invest in the Stock Market

Choosing the right online stock brokers is a tough task for many investors, yet is easy if you follow certain strategies:

Investment Strategies

For beginners, it is suggested to invest with a small amount. Also, don’t forget to define your risk quotient. A risk quotient will help you to identify how much risk you can bear during stock market trading.

Financial Analysis

It is important to do a bit of research before stepping into the stock market. This is because the financial analysis will let you know the type of stocks you should invest in. Also, it helps you to identify the past and present performance of a stock which in turn will give a clear idea that which stock will perform best in future.

Charts and Indicators

There are several indicators available to find out the potential strength of a stock. Analysis of a stock can be done in two ways: fundamental analysis and technical analysis. Technical analysis provides you with detailed insight into the movement of share prices.


Stock trading can provide good investment returns if done in a proper way. For successful trading, the selection of the right online stock brokers is crucial. They not only provide you with advance research reports but also help you to manage your risk profile.

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