Trading accounts are one of the easiest ways to buy stocks and keep track of your stocks. It is easier to open a new trading account and several firms are offering demat, trading and savings account all bundled in a single package. The trading account is the primary account for any day trader. Trading account is used to buy shares with the money stored in them. Since the digitalisation of the stock market, there is no longer the need to approach the counter at the stock market to buy stocks anymore. This has given rise to the concept called Free trading. Each and every stock that a company lists in the stock market is immediately updated in its computer network and is available to online traders. Demat accounts and Trading accounts go hand in hand in the process of stock trading. The Demat account contains the amount of money required for the transaction that is utilised by the trading account to finalise the transactions. Each trading account comes with a unique trading ID which is used to reference the user of the account. This trading ID represents you in the stock market when you are Free trading.
It is required that each transaction in the stock market is directed through a recognised stock broker. There is no such problem in a trading account as it is affiliated with a stock broker even before reaching you. Hence, you can start Free trading immediately after getting your trading account. There are various firms which offer its services at different rates. It is up to you to choose the ideal stock broker for your needs. There are a few parameters to selecting a stock broker. The stock broker should be able to process your transactions in a fast and timely manner as stocks may tend to rise or fall every given second that the market is open. The stock broker should be reputed and a reasonable Brokerage rate.
The advantages of using a Trading Account are:
- Trading accounts have a simple and easy to understand interface. There are also sophisticated stock trading tools that are provided with the trading account which shows the relation between gross profit and sales. This helps the user to understand the state of his investments in short and he could consider the current state of his investments as a reference to future trading.
- Trading account also shows the ratio between the gross profit and cost of the sold goods. This can be evaluated to find the profitability of your shares. It is always advised to go after the shares that are consistent if investing conservatively and takes risks only if your chances are good.
- You can use the trading account to compare your shares to that listed in the stock market. You can evaluate the expected profits on your investment and the general profitability of the concerned stocks.
- The Trading accounts facilitate the transfer of stocks faster and easier. You can also use the same account to buy stocks from different Stock markets.
- Trading accounts have an added advantage that they can be used to access stocks from anywhere as long as you have a strong connectivity.
- All trading firms employs customer care executives to make sure that the Free traders get the best services on a time-based manner. There is also a ease of personalisation and alerts such as calls and messages to make sure that you don’t miss out on any opportunity.