What is Online Stock Trading?
Online stock trading is a method of buying and selling shares over the internet from a computer or mobile. If you are wondering what is trading, it simply refers to the exchange of stocks for cash with the intention of profiting. Rather than contacting a broker, you can just go to an online site or application and put in your orders during market hours. These platforms show live prices, charts, and company details to help you decide. It’s fast, convenient, and often cheaper. That’s why it’s important to know the fundamentals and have knowledge of the risks, as stock prices could change quickly and unpredictably.
How Online Stock Trading Works
Stock trading online is easy and efficient if you take the proper steps. Here’s what you need to do:
| Step | What You Do | Why It Matters |
|---|---|---|
| 1 | Open a Demat & Trading Account on Findoc | Needed to store and trade shares |
| 2 | Link Bank Account to Trading Account | For smooth money transfers while buying and selling shares. |
| 3 | Use Online Platform | To access the stock market digitally |
| 4 | Select Stocks or Assets | Decide which one you want to buy or sell based on your research. |
| 5 | Place Order | Enter the quantity and price, then confirm whether you want to buy or sell. The trade will be executed once the conditions match. |
| 6 | Track Your Investments | Keep monitoring the investments as well as market performance and manage the portfolio regularly. |
Findoc provides free Demat Account opening along with smart and simple trading tools suitable for both types of users: beginner or experienced investor. This makes online trading easy, secure and hassle-free.
Additional Read: What is a Demat Account?
Types of Online Stock Trading
There are different types of assets you can trade online. Each type has its own risk and return. Below is the list of online stock trading types:
| Type | Meaning |
|---|---|
| Equities | Buying shares of companies (example: Reliance, Infosys) |
| Derivatives | Trading on the future value of assets like shares or commodities |
| Commodities | Trading goods like gold, oil, silver, wheat, etc. |
| Forex | Trading currencies like USD, EUR, INR, etc. |
| Mutual Funds | Investing in a collection of stocks/bonds managed by professionals |
Benefits of Online Trading
Risks & Safety Tips for Online Trading
Online vs Offline Trading
| Feature | Online Trading | Offline Trading |
|---|---|---|
| Access | Anytime, anywhere via the internet | Only during office hours with the broker |
| Speed | Instant execution of orders | May be delayed due to manual process |
| Cost | Usually low or zero brokerage | Often higher brokerage and service charges |
| Information | Real-time charts and data are available | Depends on the broker’s updates |
| Ease of Use | User-friendly apps/web platforms | Requires a broker or visiting an office |
| Paperwork | Completely paperless | Some physical forms may be required |
| Learning Resources | Online courses, videos, simulators | A broker might offer advice, but it is limited |
Tips to Choose the Right Online Trading Platform in India
Not all online trading platforms are the same, so it’s important to choose wisely. Here’s what you should look for:
- Easy Interface: The app should be simple and clear
- Low Charges: Check for low brokerage and zero maintenance fees
- All-In-One Tools: Look for charts, price alerts, and investment tools
- Customer Support: Good service helps if you face any issues
- Safe and Secure: The platform should use encryption and 2FA
- SEBI Registered: Only trade with SEBI-certified platforms for safety
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Frequently Asked Questions
Trading is buying and selling stocks quickly, sometimes in minutes, hours, or a few days, to profit from short-term changes in price. On the other hand, investing is buying a stock and holding it for months or years in order to build wealth over a long period of time.
You open a trading account, deposit funds, and use a broker’s online platform to buy and sell shares, mutual funds, or commodities. Orders are executed instantly, and trades settle digitally.
There is no fixed amount. You can begin trading in India with as little as ₹100 or ₹500. Findoc allows you to begin small. But always start with money you can afford to lose.
You will have to pay brokerage fees, Securities Transaction Tax (STT), GST, stamp duty, exchange fee, and capital gains tax on any profits. These will depend on your broker and the type of investment product.
Look into brokerage charges, platform features, reliability and customer support. Make sure to choose SEBI-registered brokers. Complete online KYC, upload ID and address proof, and your trading and Demat accounts will be activated in no time.
Use trading apps, stock screeners, research reports, virtual trading platforms, and basic charting tools. They help you practice, analyse stocks, track market news, and improve decision-making with minimal risk.