Process Of Investment In The Indian Stock Market

The Indian stock market occupies a space among the top-performing stock markets in the world. Major stock indices SENSEX and NIFTY of BSE and NSE respectively are breaking a record level every day that encourages domestic as well as foreign investors to participate in the Indian stock market. The market offers various segments to trade such as the equity market, bond market, derivative market, and money market that involves short-term securities. Investors use securities to fulfill their financial goals. Adequate knowledge of the stock market can help in the attainment of financial goals which are better than traditional investment plans.

The individuals (Indian residents or foreign investors), who have a desire to trade in the Indian stock market need to fulfill various requirements. The first and primary requirement is opening a trading account. Trading in the stock market assists in buying and selling stocks for the short term as well as the long term. Investors can also trade in the futures and options segment that only requires a margin facility.

Possess to invest in the stock market:

To trade in the stock market, an investor needs to follow a certain process. If you are going to invest and trade in the market, then the following process would guide you while real trading in the Indian stock market.

  • Selection of a broker:

To start trading or investment, the first and most important step is the selection of a broker. In India, various financial firms, non-banking financial companies, and other firms provide brokerage services on subscription-based and full brokerage firms. The selection of a broker depends upon a number of factors such as initial cost for registration, activation time, documentation process, and fees per transaction. Better selection of a stockbroker affects the whole buying process in the market. In the digital world, brokers come up with various advanced services that enable investors to trade independently without depending much on anyone else.

  • Open a trading account with a selected broker:

Opening a Demat account creates a path in the world of the investment market. The brokers offer their portals through which investors can open their trading and Demat accounts. To open an account, firstly investors need to register with the broker. It demands various documents and information related to investors. With the completion of a registration process, the broker takes time to digital verify the uploaded documents for the registration. Successful verification of the documents ensures account activation. A trading account usually opens for online intraday trading whereas a Demat account can be used for all types of trading. 

Every stockbroker needs various documents that make the registration process a little tricky. These documents are mandatory for all investors:

  • Personal identity proof documents: Voter card, License, Aadhar Card, Passport, PAN card
  • Bank details document: Bank passbook, 
  • Income proof documents: ITR receipts, annual income details, 6-month bank statement (If an investor has no income source, then only sufficient for income proof).
  • Start trading in the stock market:

After opening an account, every investor gets a unique client number for the broker with whom he or she has opened a trading account. In India, two major stock exchanges have listed a large number of securities that give an opportunity to investors for buying and selling the selected securities.  

With a digital Demat account, investors can explore the stocks, bonds, exchange-traded funds, and mutual fund schemes in which they can infuse a small to large investment fund. Trading in the market involves the buying and selling of any security, that is based on “T+2” clearing and settlement. A Buying with a “T+2” days settlement gives ownership of securities two days after initiation of the transaction.


The Indian stock market encourages investors to put their funds for the long term and short term. This investment requires a certain process that needs to be followed for the attainment of specific financial goals. Every step of a process has its own importance. Proper investment in the stock market can provide a better investment return as compared to other investment plans.

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