InvestorQ : How can I as an investor make the best of the online trading facility?
rhea Babu made post

How can I as an investor make the best of the online trading facility?

Answer
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krithika Saxena answered.
2 years ago


If you want to be an online trader, be a little tech savvy and also be a little security savvy. Always use your private PC or laptop only to trade. Ensure that your internet connection is secured and not an unsecured Wi-Fi connection. Remember, when you trade on a random PC or on an unsecured connection you are compromising your bank account, trading account and demat account. Please be obsessed about security, hardware and software issues. If you are unfamiliar with these issues then get familiar. There is no way you can be a good online trader if you do not understand technology.

Online trading is largely self-driven. You need to cultivate the ability to research and execute on your own to be really effective. Every online trading portal gives you sufficient information and tools to do your research. Make the best of it. You can use your broker’s recommendation as a starting point. Try to ratify with your own research before taking a buy or sell decision on any stock. That is the real power of online trading.

Thirdly, your online trading facility gives you direct access to the availability of any stock at various price points. Don’t simply jump into a market order. Observe the market for some time to get cues on the demand pattern. If you see weakness in a stock, try to buy at a lower price. Online trading empowers you to do that.

Fourthly, most online brokers give you live news and corporate announcements during trading hours. Make the best of it. More often than not, tracking this information helps you to decide on your existing investments and trading positions. Over a period of time you will realize that it is fairly easy.

Just because you are online and every piece of information is online, you can let your guard down. You need to focus on MIS here also. Keep a tab on your online trading statements and your contract notes to ensure that you are getting stocks at the price you want. Always cross check that order cancellations are actually implemented by the system. Also ensure that you get demat credits of your purchases latest by T+3 day. This will help you to locate any lacunae in the process and immediately bring it to the notice of y our broker.

Lastly, most online trading portals also permit you to create portfolios online and also take stock of your capital gains / losses over a period of time. This is useful to identify if your trading activity is profitable over a period of time. Use this feature extensively and regularly to modify your strategy, if necessary. This is not only important to keep a tab on your net worth but also for your year-end tax filing purpose. Make the best of it.