Pre-requisites for Investing in Securities Market

To invest in the securities market, particularly in equity shares, an investor must open the following accounts:

Bank Account: Necessary for financial transactions.
Trading Account: Also known as a broking account, this is opened with a SEBI-registered stock broker of a recognized Stock Exchange. It is used for buying and selling securities on the Stock Exchanges.
Demat Account: Required for holding securities in electronic form.

Key Considerations for Opening a Trading Account

When opening a trading account, keep the following points in mind:

Fill the Account Opening Form carefully and submit signed Know Your Client (KYC) documents.
While filling the account opening form:
- Sign indicating preferences for trading in different exchanges.
- Note all applicable charges/fees/brokerage and keep a record.
- Identify the segments you wish to trade in (e.g., cash, F&O, Currency Derivative).
- Understand that trading in derivatives requires knowledge of derivative products.
For additional facilities like Running Account facility or Power of Attorney, provide specific authorization to the stock broker.
Include your email address and mobile number in the account opening form for updates from the broker and stock exchanges.
Always demand and keep a copy of the account opening form for your records.