DIRECT EQUITY

You need three accounts:

Demat Account – To hold shares in electronic form.

Trading Account – To buy and sell securities.

Bank Account – To transfer funds for trading activities.

A Trading account is used to place buy/sell orders, whereas a Demat account is used to store shares electronically. When you trade, securities are credited/debited from your Demat account.

You must be:

Resident Indian, NRI, PIO, or OCI

Above 18 years of age

Have a valid PAN, bank account, and complete KYC process

Safe electronic storage

Faster settlement (T+2)

Reduced risk of theft/damage

Auto credit of bonus/splits

Easy portfolio tracking

Holdings: Shares owned and available in your Demat account (T+1 onwards).

Positions: Ongoing intraday or derivative trades updated in real-time.

Demat Debit and Pledge Instruction (DDPI) allows brokers to debit securities for settlement and margin purposes without Power of Attorney. It is optional as per SEBI rules.

PoA authorizes the broker to operate your Demat account for settlement purposes. It is not mandatory as per SEBI guidelines.

An AP is appointed by a stock broker to provide access to trading platforms as an agent of the broker.

You can trade on NSE and BSE in the Cash segment.

Charges include:

Securities Transaction Tax (STT)

Exchange transaction charges

GST

SEBI charges

Stamp duty

As per NSE & BSE bye-laws:

Equity: Maximum 2.5% of contract value

Options: 2.5% of premium or ₹100 per lot (whichever is higher)

IPF compensates investors if a broker is declared defaulter and assets are insufficient to meet investor claims.

Arbitration is a dispute resolution mechanism provided by stock exchanges to resolve disputes between brokers and clients.

Clients can pledge securities for margin purposes without transferring ownership. Shares remain in the client’s Demat account with full transparency

If a seller fails to deliver shares, the exchange conducts an auction to complete settlement. The price difference may be recovered from the seller.

SEBI mandates strict margin monitoring, pledge transparency, and regulated settlement cycles to ensure investor protection.

You can add funds via UPI, Net Banking, NEFT, IMPS, and RTGS

Funds are reflected in real-time, depending on the payment mode used.

You can request withdrawal from your dashboard. The eligible amount will be credited to your registered bank account.

Due to SEBI peak margin rules, part of the sale proceeds are blocked until settlement (T+1). However, 100% can be used for trading.

Pay-in: Transfer of funds/securities to clearing corporation.

Pay-out: Receipt of funds/securities after settlement.

Market Orders

Limit Orders

After Market Orders (AMO)

AMO is placed after market hours (5:00 PM – 9:00 AM) and executed when the market opens the next trading day

Yes, you can modify or cancel orders before execution from the Order Book.

Orders can be placed via:

Web platform

Mobile app

Call & Trade

Visiting broker office

MTM (Mark to Market) reflects daily profit/loss. MTM square off refers to closing intraday positions within the same trading day.

MTF allows you to buy shares by paying a partial margin and borrowing the remaining funds from the broker at applicable interest.

Minimum 25% maintenance margin is required. Non-compliance may lead to liquidation of positions.

Futures obligate buying/selling at a future date, while Options provide the right (not obligation) to buy/sell at a predetermined price.

F&O trading carries high risk including leverage impact, margin loss, volatility risk, and potential physical delivery obligations.

Rollover means closing the current month contract and opening the next month contract to continue your position.