How to Open a Trading Account

Approach any SEBI and exchange-registered entity such as a bank or a stock broker such as IIFL Securities to open a Trading and Demat account. They provide account opening forms. Fill in the required details; it takes just a few minutes. Ensure you are prepared with necessary documents that include –

• PAN card
• Aadhaar card
• Bank details
• Passport-sized photograph 

Following processing and verification, the trading account will be activated, and trading can be initiated by buying/selling shares in the stock market.

What is a Trading Account?

Similar to a bank account, a Demat account is used to store the different kinds of securities bought by the investor. Meanwhile, a trading account is required to hold or buy new securities. It 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.

You just have to place the order through the trading account, and the request to buy/sell is forwarded to the stock exchanges. Once completed, the securities are deposited into the demat account, and the required amount is deducted from the bank account.

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

Step-by-Step Guide on How to Open a Trading Account

Step 1: Identify the Best Stockbroker You Can Use

The starting point is to select an appropriate stockbroker. You also have two main choices between traditional brokers and discount brokers. This means that the traditional type of broker will provide even more services, such as market-study trading advice, among others, but they happen to charge more for services. Discount brokers, which are less expensive, would only provide basic tools meant for self-directed trading.

Step 2: Brokerage Fees and Services 

Compare brokerage charges and services. A traditional broker might charge the customer relatively higher fees while offering considerable services, but discount brokers charge rather lower, fixed fees per transaction. Make a selection of services that are appropriately important to your trading approach.

Step 3: Contact Your Selected Broker

Once you select a broker, you must contact them. Most brokers nowadays have an online platform through which one can open a trading account, and it is quite fast and easy. In case you need more information or some guidance to get into the right place, you can contact their customer support.

Step 4: Account Setting up and KYC Process  

Now, you have to fill out the account opening form, which you can find mostly online. You will be expected to provide PAN card information, personal information, contact information, and bank information. You will also need to provide KYC documents, including identification proof, address proof, a recent photograph, and your signature. To trade in Futures & Options, you may need income proof. You can complete your in-person verification by doing a video and e-signing the documents using an Aadhaar-linked phone number.

Step 5: Verification of Application  

Once you apply, the broker’s verification team will cross-check your details against your KYC documents. Ensure that all information given is correct, as any anomaly may delay or reject the application.

Step 6: Account Login Credentials

After the verification process is over, you will get all the information along with the login details to the trading account. Before you begin trading, you have to transfer an amount of money from your bank account into your trading account.

Step 7: Begin Trading and Order Management

With the trading account activated, you could now log into the website and begin setting up buy or sell orders. The broker may send over a Power of Attorney form that must be signed. This document would authorise the broker to debit shares from your account when you execute the sell order, thereby making the process of handling transactions easier with the new laws in place.

Benefits of IIFL Securities 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 with a host of benefits.

• Convenient Access: Allows you to buy and sell shares online, providing easy access to stock markets from anywhere.
• Real-Time Trading: Enables real-time monitoring of stock prices and quick execution of trades.
• Diverse Investment Options: Offers access to various investment products, including equities, commodities, mutual funds, and more.
• Seamless Integration: Links with your bank and Demat accounts, streamlining fund transfers and share transactions.
• Advanced Tools: Provides analytical tools, charts, and market research to help you make informed trading decisions.
• Secure Transactions: Ensures secure and transparent trading through authorised stockbrokers, reducing risks.

Documents Required to Open Trading Account

To open a Demat and Trading Account online, you’ll need the following documents:

Mandatory Documents to Open Trading Account:

• PAN Card (required for all applicants)

Proof of Address (any one):

• Passport
• Driving License
• Voter ID
• Aadhaar Card (with masked Aadhaar number)
• Bank Statement (last 3 months)

Proof of Identity (anyone):

• PAN Card
• Passport
• Driving License

Additional Documents to Open Trading Account:

• Recent Photograph
• Signature on white paper
• Bank Details (cancelled cheque or bank statement with IFSC code and account number)

Income Proof (for Futures & Options trading): 

• 6-month bank statement
•  3-month salary slip
• Net-worth certificate
• ITR statement
• Demat holding statement