InvestorQ : How can I transfer funds into my trading account and how are funds accepted by brokers?
Niraj Mehta made post

How can I transfer funds into my trading account and how are funds accepted by brokers?

Answer
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sara Kunju answered.
1 year ago


Before you actually start trading, you need to transfer funds into your trading account. Whether you want to trade for delivery or for intraday or even for short term trading in futures and options, the first step is to fund your account and ensure that there is adequate margins to put in your trade. Even for a leveraged trade, you need to margin as a risk management measure and also as per SEBI statutory requirements. Therefore, trading begins with fund transfer into your trading account. There are different ways of doing the money transfer into your account. You can either use the payment gateway that the online broking facility provides, the NEFT/RTGS facility or you can also pay by margin cheque / DD to your broker.

Nowadays, brokers are also allowing you to pay by the Unified Payment Interface (UPI) or through the IMPS facility wherein you can even transfer money after online banking hours and even on banking holidays. When you buy shares there is a payin that is debited to your trading account and when you sell shares there is a payout that is credited. But before you buy shares you first need to transfer funds into your trading account. That is the starting point. Ensure that the funds you transfer are sufficient to take care of the initial margin and also leave a small surplus margin for mark to market needs so that you do not have to rush in and dispose your shares in a hurry.