What are the first steps to invest in the Indian stock market? How do you open a Demat account and start buying shares?

This describes three basic steps for beginners who wish to start or just starting to invest in Indian stock market.

1. Choosing right broker
2. Opening demat account
3. Start buying shares

Step 1: Choosing a right broker:

If you wish to invest for long term then this may not be a big deal for you. However if you wish to trade then this is a crucial step.

Here are the top brokers and few details abut them. You can choose based on your requirement.

5Paisa Demat Account- Best Demat Account In India With A Lowest Brokerage.

Unlike other demat and trading platforms, 5 Paisa offers flat Rs. 10 for trade. No matter how much you buy. You will not be charged based on any percentage.

Other Benefits

• First 5 trades free with no DP charges
• First Year Annual Maintenance Charges – Nil
• Invest in Mutual Funds and buy insurance through same account
• Opening Charges – 750 Rs, but you can discuss if they waive off

Angel Broking Demat Account: Best Demat Account For Small Investors In India.

 

Angel broking is one of the oldest brokerage company in India.

Additional Services

• Margin provided up to 10 times of the amount deposit.
• Free SMS advisory service for 3 months.
• You can start trading within 1 hour through digital KYC.

Account Charges of Angel Broking

• Trading Account Opening Charges – Rs 0.
• Demat Account Opening Charges – Rs 0.
• Angel Classic ( 10,000 to 24,999) – Rs 450 per annum.
• Angel Preferred ( 25,000 to 49,999) – No AMC for 1st year and Rs 450 p.a afterwards.
• Angel Premier ( 50,000 to 99,999) – No AMC for 2 year and Rs 450 p.a afterwards.
• Angel Elite ( 1,00,000 & more) – No AMC for 3 years and Rs 450 p.a afterwards.

Everything is great except one thing. Brokerage charge is capped at a minimum of Rs 30 per transaction, which makes angel broking a little less beneficial for the small investors. You have to bear higher brokerage charges even on the small transactions.

Sharekhan Demat & Trading Account:

Sharekhan is one of the leading online brokerage company having more than 12 lakh customer base.

Benefits of Sharekhan

• Account opening charges are adjusted towards first six months brokerage or waived off.
• No annual maintenance charge for the first year.
• Sharekhan provides online & offline training workshops to investors.
• Free call & trade facility.

Drawbacks of Sharekhan

• Minimum brokerage charge per stock would reduce your profit on trading small (penny) stock.
• Brokerage rate is higher as compared to other demat companies. But you can negotiate at the time of account opening.

Motilal Oswal Demat Account:

Presently the company has more than 1700 business locations with over 7.5 lakh registered customers. Motilal oswal’s solid research based advice is the reason of such a strong customer base. They spend Around 10% revenue on research and on hiring & training for research.

Benefits of Motilal Oswal

• Award winning research advice covers around 95% of market capitalisation.
• Provides free brokerage for the first month

Zerodha:

Zerodha is amongst the fastest growing, top volume contributors with an average daily trading turnover of over Rs 10,000 crores. The company now offers traders and investors in equities to open demat account instantaneously with their Aadhaar.

The brokerage firm charges a flat fee of Rs 20 per transaction. Intraday and equity futures attract a fee of 0.01% or Rs. 20/ trading transaction whichever is lower

• Equity delivery transactions are offered free.
• Demat account opening charges are Rs 100.
• Demat account Annual Maintenance Charges are Rs 300 per year.

ICICI Direct Demat And Trading Account-Best Bank For Demat Account In India ( 3-In-1 Account ):

I use ICICI demat account.

These guys charge lot of brokerages. It is said that they provide one of the best security. I don’t mind much on brokerages so i have not changed my demat account.

Step 2: Opening Demat account:

• Go to a online discount broker website, you can open your account yourself or give your contact details for your help.
• Keep pan card and adhar card for instant online account opening. You can also ask one of the agent to collect the required documents from your place. Alternatively visit local branch office as per your convenience.

Step 3: Start buying shares

Basically above steps were like instruction before giving exam but how well you will perform in your exam depends on how well you prepare. That is most important.

Here are few tips or tricks that i feel good to follow in stock market to perform well. This is for investment point of view as i don’t know much about trading.

1. Accept that you are beginner. Keep your ego aside and be honest with yourself. If you prefer to ignore, you are going to loose your money.
2. Never use borrowed money or leverage other’s money while investing in stock market. Bitter truth is no one in this universe can accurately predict stock market movement. Many people have gone bankrupt, have committed suicide, divorced, sold their homes or properties or cars and discontinued or shifted their children’s education during market crash.
3. If you are getting a return of 20% plus per year consistently consider yourself better performer.
4. Greed and fear are two most important emotions that play a vital role in stock market. Always try to think logically. Understand the power of compounding so that you will not come under the grip of greed.
5. Study, study and study. Do as much research as you can do. Listen to as much as what other elite investors are saying and most importantly why are they saying so for any stock. When you start your journey, you have to adjust your strategy, learn from your mistake, adopt the rules that suit you. Initially go with nifty 50 stocks only. Later you can look for BSE midcap and later you can look for bse small cap. Don’t move out of those unless you have got a very good exposure.

Always keep an open mind and never stop learning.

Happy investing !

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