How to Open a Trading Account?

What is a Trading Account?

All the three accounts are linked and work in tandem with each other. The bank account is used to store cash which is used to trade in securities. The demat account is hosted by depositories and is used to store the different kinds of securities bought by the investor. But when you have to sell your holdings or buy new securities, you will have to use a trading account. The trading account is essentially an interface between the demat account and the investor. It is not possible to buy or sell a unit of security without a trading account. The trading account has replaced the open outcry system prevalent in earlier times. Now, you just have to place the order through the trading account and the request is forwarded to the stock exchanges. Upon the completion of the transaction, the securities are deposited in the demat account and the required amount is deducted from the bank account.

Uses of Trading Account

A trading account is not limited to stocks. There are trading accounts for currencies, commodities, bonds, gold and exchange-traded funds. There are several benefits of an online trading account. The biggest benefit is that you can open trading accounts online and do not need to visit a bank or the office of the broker. Trading accounts provide one-point access unlike physical trading.

Through a single trading account, you can access stock exchanges like BSE and the National Stock Exchange and commodity exchanges like Multi-Commodity Exchange and National Commodity and Derivatives Exchange. Open trading accounts online to get the flexibility to trade through multiple mediums. With a trading account you can trade through mobile, desktop or through a call.

Step by Step Guide on How to Open a Trading Account

Opening a trading account online opens up a host of investing possibilities. You must be wondering how to open a trading account. You can open a trading account in a few simple steps.

• In the first step, choose a brokerage firm to open a trading account. Conduct thorough research and opt for a credible brokerage firm. Take the various charges levied by brokerages, the interface of the trading platform and the value-added services into account before finalising a brokerage.
• After zeroing in on the broker, get in touch with and enquire about the trading account opening procedure. The brokerage will require you to fill up an account opening form and a Know Your Customer form. A representative from the brokerage firm will assist you with the process. Most brokerages offer a demat-cum-trading account as a demat account is mandatory to store the securities.
• Along with the forms, you will have to submit identity proof, residence proof and in some cases proof of income. A photocopy of the Aadhar card or passport, besides several other documents can be used as proof of residence. Similarly, a copy of an Aadhar card or PAN card can be used as identity proof. The PAN card is compulsory to open a trading account.
• Post submission of the documents, the brokerage will conduct a manual Know Your Customer verification. A representative may visit your house to verify the documents or you may be asked to verify the documents over the phone.
• If you do not want to manually verify the documents, you can opt for the e-KYC process. For the e-KYC process, you will have to ensure that your PAN card is linked to the Aadhar card and your bank account. The mobile number submitted in the account opening form should be the same as the Aadhar card for the e-KYC process.
• It generally takes 3-4 days to activate the trading account after the completion of the verification process.

Benefits of India Infoline Trading Account

IIFL Securities is one of the oldest and the most credible names in the market. Opening a trading account with IIFL Securities can provide you a host of benefits.

• The company offers paperless account opening option improving customer convenience.
• Successful investing is a result of informed decisions based on reliable information. Along with the facility to buy and sell securities, you also get access to reliable financial data and research reports with the IIFL Demat and Trading account.
• The requirement for different categories of investors varies. A day trader may need low brokerage rates, but a long-term investor may not be concerned with brokerage fees. IIFL Securities provides an option of three brokerage plans to choose from.
• The company has an extensive network of over 4000 branches across India.
• It also gives the investors an edge with its five next-generation trading platforms. With IIFL Securities, you do not have to worry about asset classes as it facilitates trading in all segments such as equity, derivatives, commodity, currency and mutual funds.

IIFL Trading Platforms & Technologies

IIFL has developed various trading platforms to suit the needs of different types of investors. Some investors need different types of charts and financial data, while some investors need just research reports. Depending on the level of investor’s sophistication, IIFL offers five different next generation platforms.

• IIFL Markets:

  One of the simplest trading apps available in the country. The IIFL Markets platform has been awarded on multiple occasions. It provides a simple interface with live prices, customisable watchlist and an advanced dashboard.

• TT Iris:

  It has been developed in collaboration with Spider Software and helps you track important market movements and conduct real-time analysis. The TT Iris platform provides advanced charting and technical analysis tools.

• IIFL MF App:

  You can invest in mutual funds and track MF investments through the IIFL MF App. The app has a paperless registration process and you can also receive suggestions through the platform.

Along with the IIFL Markets, IIFL MF and TT Iris, IIFL has also developed the TT Web and the TTExe platforms.

Trading Account Charges (Refer to the fees page for details)

IIFL Securities has three equity brokerage plans catering to different types of investors.

• Variable Brokerage Plan:

  The brokerage under the variable brokerage plan depends on the monthly volume of the investor. Investors with higher volumes get lower brokerage rates. In the delivery cash segment, the brokerage for a monthly turnover of less than Rs 1 lakh is 0.60%, while for a turnover of over Rs 2 crores, the brokerage is 0.15%. There are various turnover slabs between Rs 1 lakh and Rs 200 lakh.

• Flat brokerage charge:

  The brokerage is charged at a flat rate, irrespective if the monthly turnover, under the flat brokerage plan. The brokerage for delivery trades is 0.50% of the transaction. The brokerage for intraday trades is 0.05% on both buy and sell transactions.

• Value-added subscription plan:

  The value-added subscription plan has been designed for frequent traders. There are 7 different subscription plans under the model. You can pay an amount and avail lower brokerage charges for a specified period of time. For instance, under the Rs 5000 plan or V5000VAS, the brokerage for delivery trades reduces to 0.35% as against 0.50% in the default plan.