Online stock trading is the buying and selling of the stocks and bonds through the internet. Through the advent of internet and its easy access to everyone, it has become easy and convenient for anyone to do the online stock trading and has opened a whole new world for the retail investors.
Stock is basically a small portion of the company .Thus anyone buying the stock becomes the shareholder of that company. The first time the company offers its share to general public is called IPO and future price of shares depends on the performance of the company and other economic conditions.
For the online stock trading, it is essential to have an account with the stock brokers which can be linked online to the bank account also known as Demat account. With the DE mat account’s user id and password, the user can do the online stock trading himself. Once the user is logged in, he has access to dedicated and easy to use interface where he can see various stocks listed in the market with their prices. These stocks can be bought with the help of money placed in the demat account. Once the user places a request for buying a stock, the broking house process the request and the stock is deposited in the investor’s account.
Apart from basic stock trading, almost every online stock trading websites has the facility to let the user invest in the IPOs and mutual funds as well. A keen follower of the stock market always use the online stock trading account to keep a track of the various share prices throughout the day. Money can be easily transferred from bank account to Demat account and vice versa.
Online stock trading is surely very tempting and should not be taken lightly. Before investing in stocks, one needs to have in depth knowledge of the stock market. Various points should be kept in mind such as first practicing the skill of stock trading with a small amount of money in the penny stock market.