For those who know trading in the stock market, it is an ocean of opportunity to make quick money. However, many people do not understand the trend and logic of dealing and hence just keep on trading which leads to severe loss. For effective trading one must know the basics and also keep himself updated about the movement of the market and trends. In many cases, those who depend on tips punch wrong trades and hence in a few trades only the profile gets spoiled.
For every trader, a trading account is much required. There is also Demat account required to park the shares which are purchased on delivery basis. The shares which are purchased for the intraday trading, there is no need to park, and hence one does not need them to move to the Demat account also. One who wants to earn a profit in the up or down market also, needs to go for a little research and find the best trading account with any sub-broker or even a broking company. In the market, one can find lots of brokers, and after checking the brokerage rate, the condition of margin money and finance as well as settlement period for an account, one can go for an account with a right broker. There are different segments in the stock market which are cash and derivatives. In the cash segment, one can find the intraday as well as delivery trading options. There are call and put options available in the derivative segment.
The accounts and trading:
To get profit the trading is a must. All the traders know this fact well, however, how one wants to trade, depends on the choice of the trader. There are different segments such as cash and derivative. One can go for any of them or combine them to a definite proportion. In cash also there are two segments which are known as intraday and delivery while in the derivatives there are call and put options in which one can deal.
In the intraday trading one needs to buy and sell the shares on the same day if he buys the shares, but at the time of the end of the session, he prefers it to hold and do not clear the position, it converts the trade to delivery trade. In a couple of days, the trader has to either sell the shares of clear the position by paying the share value to the broker.
In the derivative segment, one does not deal with individual shares, but there is a lot. There is also a contract date, and till then he can hold the position, but before the expiry of the contract date, he must clear the position. Hence in this segment, one can have a larger period which can be negative or positive also. In the case of constant fall of the market, the prices may reduce over a period and hence the trader may have to bear heavy loss also. In the intraday the loss or profit is limited.