Realize the Expenses Incurred in Demat/trading stock:

Transaction Charges:

A trader shall have to shell out a few bugs to get the transactions done in the Demat account. Whenever a trader/ investor buys or sells a stock/share, the brokerage collects a fee to conduct the trading.

Besides brokerage charges, the investor remits different taxes through the assigned broker.

They are

1. Securities Transaction Tax (STT)
2. SEBI charges
3. Goods and Services Tax (GST)

Demat Account Charges:

To buy/sell the electronically stored stocks, the government of India has set up a security mechanism in the interest of the retail/corporate traders.

The government of India has authorized Central Securities Depositories like NSDL or CDSL to safeguard the Demat accounts.

Therefore, to keep the Demat services under scrutiny, the Central Securities Depositories collects a nominal fee. It can vary somewhere between INR 100 to INR 750 (Depending on the No. of shares and the value of shares bought).

Tax on Gains

• The government of India has officiated to tax on profits earned from selling the stocks.
• The central government has established well-defined norms. If an investor holds a stock for more than a year, then the government collects a long-term capital gain tax of 10 percent on the profit earned.
• If an investor holds a stock for less than 1 year then the government shall put a short-term capital gain tax of 15 percent on the gain.
• The investor is liable to pay a change in the tax as the government takes the right to alter the value of cess or surcharge implemented by the government.

Follow these simple steps to start investing in stocks today:

Investors Must Start their Investment Journey in Stocks Cautiously!

Stocks are a lucrative financial investment provided one starts a journey cautiously. If an individual plans to invest a portion of the savings into stocks then one must plan the investment in a step-by-step manner.

For any beginner, it looks absolutely attractive but the stock markets fluctuate to drive the stocks bullish or bearish.

The sharp rise and fall in the stock values is something an investor needs to take in a stride and progress assertively.

However, here are a few tips that can make a reader feel comfortable while selecting stocks and thereby deciding to maintain a well-balanced portfolio.

How to Invest in Stocks as a Beginner?

For a beginner to start with, one should seek guidance from the right broker who recommends the right kind of stocks and a diversified portfolio. In addition, one must cautiously plan the number of investments at the initial stages.

Usually, it is said, anywhere between Rs. 2000/- and Rs. 10,000/- will do. In case an investor wants to make independent decisions when buying and selling a stock, for that matter, gaining the essence of the stock market investments becomes imperative.

In nutshell, one must know where stocks are put to trade while the market fluctuates. For that, one must select the right broker, and under that brokerage firms or depository participants (DPs), begin trade to niche milestones.

To do so, a beginner must be equipped with two specific accounts, namely, a Demat account and a trading account.

Just to brief it, a Demat means dematerialization. In short, an investor is converting the hard copy of acquired stocks to a soft copy. The soft copy of the stocks/shares is kept under the custody of an authorized bank. Since these stocks/shares are placed in an investor’s account in a bank, they are termed Demat accounts.

A trading account comes to play when an investor plans to buy/sell the stocks/shares. The investor must request the banker to create a trading account to put the Demat shares for trading.

Open a Free Demat Account Here

How to Open a Demat/ Trading Account

Enrollment Process for a Demat/Trading Account With Banks:

The process of enrollment with a bank for a Demat/trading account involves a procedure that is likely to be followed.

• The investor must approach the bank that provides the facilities to open the account and put stocks/shares to trade.
• Usually, an investor is advised to open a Demat/trading account with a single bank and at the time of admission to the bank, one must submit the following documents for validation.

Documents Required for Opening Demat Account

An investor must present

• Permanent Address Proof
• Identity proof, and
• e-KYC. the annual salary in addition.

When the bank generates a trading account it usually links the investor’s AADHAR number to this account.

Demat Account Charges

Realize the Expenses Incurred in Demat/trading stock:

Transaction Charges:

An investor shall have to shell out a few bugs to get the business transactions done. Whenever an investor buys or sells a stock/share, the brokerage collects a fee to conduct the trading.

Besides brokerage charges, the investor remits different taxes through the assigned broker. They are Securities Transaction Tax, STT, SEBI charges, Goods and Services Tax (GST).

Demat Account Charges:

To buy/sell the electronically stored stocks, the government of India has set up a security mechanism in the interest of the retail/corporate traders.

The government of India has authorized Central Securities Depositories like NSDL or CDSL to safeguard the Demat accounts.

Therefore, to keep the demat services under scrutiny, the Central Securities Depositories collects a nominal fee. It can vary somewhere between INR 100 to INR 750.

Tax on Gains:

• The government of India has officiated to tax on profits earned from selling the stocks.
• The central government has established well-defined norms. If an investor holds a stock for more than a year, then the government collects a long-term capital gain tax of 10 percent on the profit earned.
• If an investor holds a stock for less than 1 year then the government shall put a short-term capital gain tax of 15 percent on the gain.
• The investor is liable to pay a change in the tax as the government takes the right to alter the value of cess or surcharge implemented by the government.

Apply Business Analytics on a Company before Investing

An investor must invest more time in analyzing companies before making an investment. Share experts say that thorough research on the company fundamentals is absolute.

A company may have a revenue generation model that defines the strategies/tactics to achieve goals. It speaks in detail about the kind of business operations a company performs like investment in a specific business and the revenue it creates.

The companies are entirely dependent on the management policies and the engagement of a flexible working environment.

However, an investor must take a keen note of the stability of the management and its rightful implementation of the projects. Another important issue one must keep in practice is the comparison of a company with other competitors.

Risk Management in Investment

Managing Risks at BSE/NSE: Investors Strategies

One can find plenty of investors adopting their strategies to achieve their set goals in making money. Experts say that the risk appetite differs from individual to individual.

Risk-bearing capacity is proportional to the income earned in a family. An investor may have framed the duration of investment, capital, and return on investment.

Analytics say that individuals(investors) tend to opt for debt, large-cap stocks as they want to incur less risk. Individuals who can match high risks can opt for small-cap funds, and higher-risk stocks.

Investors Must Make Investments Regularly

Financial experts are of the opinion that a systematic investment plan, SIP, is a monthly investment that involves less risk such as mutual funds. This kind of investment can make an investor develop investing habits and improvise funding over a period of time.

How to Diversify your Portfolio

Diversify Investment in Different Portfolio

The basic aim of diversification is to make investments in different portfolios. When an investor buys an asset from a diverse range, it reduces the risk though few assets perform badly. It enables the broker to keep the investments on an upward swing.

Investor Must Rebalance Portfolio

The investor is advised to keep changing portfolios a few times for every quarter of a year. One must observe a stock or asset value and never favor a stock high or under evaluation.