To understand the benefits of online trading, you need to understand the hassles of offline trading. For those of us who have seen the pain of offline trading, the downsides were numerous. You placed an order and you could never be sure that you would get the best price for your order. More often than not, the dealer would prioritize your order based on your past relationship and brokerage revenue. A small investor was typically at a disadvantage in the broking game.

There is a great focus on transparency when it comes to online trading. Everything is before you on the screen in front of you. Online trading makes sense for a variety of reasons. Firstly, the investor is perfectly aware at what price the order can be placed and in what quantity. Secondly, online trading has created a democratic market place because what you see on the screen is largely what you get. The age-old risk of the dealer not operating in your interest is substantially, if not entirely, eliminated.

The advantage of online trading is that it integrates 3 critical components of any trader’s interaction viz. banking funds, trading engine and demat holdings. The three get linked in a seamless pattern. The link between 3 components becomes virtually seamless in online trading. An investor is able to allocate funds of his choice, trade at the time and price of his choice and be rest assured that the demat credit comes on T+2 day.