{"id":323,"date":"2020-03-06T08:47:54","date_gmt":"2020-03-06T08:47:54","guid":{"rendered":"https:\/\/www.invest19.com\/blog\/?p=323"},"modified":"2020-03-06T08:47:56","modified_gmt":"2020-03-06T08:47:56","slug":"how-to-buy-and-sell-shares-online-for-beginners","status":"publish","type":"post","link":"https:\/\/www.invest19.com\/blog\/how-to-buy-and-sell-shares-online-for-beginners\/","title":{"rendered":"How to Buy and Sell Shares Online? \u2013 Step-by-Step Guide for Beginners"},"content":{"rendered":"<div style=\"margin-top: 0px; margin-bottom: 0px;\" class=\"sharethis-inline-share-buttons\" ><\/div>\n<p>Being\na beginner, it must be hard figuring out how you\u2019re going to buy and sell\nshares online and make investments to build enough wealth for your retirement.\nMany retail investors have Demat accounts and yet unaware of the procedure of\nbuying &amp; selling shares. FYI, India is one of the fastest-growing wealth\nmanagement markets in the world with a history of more than 100 years and 7,000\npublic listed companies. In addition to it, India has just become the 5<sup>th<\/sup>\nlargest economy in the world after defeating UK &amp; France now on the path to\nbecome the 4<sup>th<\/sup> largest private wealth market globally by 2028. This\nwidening in capital markets will be the key factor in the economic development\nof the country. However, in terms of market capitalization, we are still way\nbehind compared to global standards. The participation of retail investors in\nIndian capital markets is significantly low and only near around 3% of the\noverall population is invested in the stock market. <\/p>\n\n\n\n<p>Keeping\nin view the importance of retail participation in capital markets, people must\nbe taught with the DIY (Do-it-yourself) way of buying and selling shares in the\nstock market for the economic growth of the country. Achieving this won\u2019t be\neasy, but you gotta start somewhere. But before we proceed, let\u2019s clear a few\nthings: <\/p>\n\n\n\n<p>For\ninstance, when someone says, how to buy and sell shares online? There are two\nlogical meaning behind this question. First, a person is a complete beginner in\nthe stock market and is not familiar with the ways of buying and selling shares<strong>.<\/strong> Second, a person has a Demat account\nand the financial knowledge needed to invest in the stock market but don\u2019t know\nhow to buy and sell shares to make the most out of his investments. In short,\nhe is looking for stock market tips or tips to select the right stocks to\ninvest. <\/p>\n\n\n\n<p>Therefore, we will take these both scenarios one-by-one.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"counter-hierarchy counter-decimal ez-toc-grey\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\"><i class=\"ez-toc-glyphicon ez-toc-icon-toggle\"><\/i><\/a><\/span><\/div>\n<nav><ul class=\"ez-toc-list\"><li><a href=\"#How_to_Buy_and_Sell_Shares_Online_For_Beginners\" title=\"How to Buy and Sell\nShares Online? \u2013 For Beginners \">How to Buy and Sell\nShares Online? \u2013 For Beginners <\/a><ul><li><a href=\"#Step_01_Get_your_PAN_Card\" title=\"Step 01: Get your\nPAN Card\">Step 01: Get your\nPAN Card<\/a><\/li><li><a href=\"#Step_02_Find_a_Stockbroker\" title=\"Step 02: Find a\nStockbroker\">Step 02: Find a\nStockbroker<\/a><\/li><li><a href=\"#Step_03_Open_a_Demat_Trading_Account\" title=\"Step 03: Open a\nDemat &amp; Trading Account\">Step 03: Open a\nDemat &amp; Trading Account<\/a><\/li><li><a href=\"#Step_04_Transfer_Money_in_your_Account\" title=\"Step 04: Transfer Money in your Account\">Step 04: Transfer Money in your Account<\/a><\/li><li><a href=\"#Step_05_Select_the_Shares_you_want_to_buy\" title=\"Step 05: Select the Shares you want to buy \">Step 05: Select the Shares you want to buy <\/a><\/li><li><a href=\"#Step_06_Place_your_Buy_Order\" title=\"Step 06: Place your Buy Order\">Step 06: Place your Buy Order<\/a><\/li><li><a href=\"#Step_07_Place_your_Sell_Order\" title=\"Step 07: Place your Sell Order\">Step 07: Place your Sell Order<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\">How to Buy and Sell\nShares Online? \u2013 For Beginners <\/h2>\n\n\n\n<p>The\nstock market is one of the most sought-after investment options for Indians\nafter gold and real estate. Although the stock market is volatile, buying\nshares can help you generate a lot of money. However, you must be willing to\nbear the high risk of investing in the stock market. In India, people are\nalways skeptical when it comes to investing in the stock market<strong>.<\/strong> Truth is, investments made inequities\ncan allow you to generate higher profits than investments made in gold, silver,\nor any other financial instrument. <\/p>\n\n\n\n<p>Besides,\nas we mentioned earlier, the capital markets are the key factor in the economic\ndevelopment of a country. Thus, you must learn your ways to buy and sell shares\nonline via Demat account. Once you become an expert in that you can try\ndabbling in the market any way you want. <\/p>\n\n\n\n<p>Here,\nwe\u2019re going to discuss the way of buying and selling shares for a beginner and\nenters the world of the stock market. <\/p>\n\n\n\n<p>There\nare a series of steps that you need to follow to start buying and selling\nshares which are as follow:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 01: Get your\nPAN Card<\/h3>\n\n\n\n<p>Do\nyou have your PAN Card? \u2013 If not then you better get your PAN card. PAN Card is\na ten-character alphanumeric permanent account number treated as an identifier\nand issued in the form of a card, by the Income Tax Department, India. If you\nplan to buy shares online then get this \u2013 You need a PAN card! Or better, to\nmake any financial transaction, you need a PAN card. And not just in case of investing\nin stocks but if you\u2019ve decided to invest in mutual funds, FDs, PPFs, and RDs\nor want to open a bank account, you are going to need a PAN card for that too. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 02: Find a\nStockbroker<\/h3>\n\n\n\n<p>Once\nyou get your PAN Card ready, it doesn\u2019t mean you go straight to the exchange or\ncall directly in the company whose shares you wishes to buy. There are certain\nindividuals, online agencies, and companies who are authorized to buy and sell\nshares on the stock exchange in the primary market. They are often known by\nname \u2013 <em>brokers<\/em>. These stockbrokers\nare registered and licensed by domestic market regulator Securities &amp;\nExchange Board of India (SEBI). While working out as an intermediary between\nshare trader and exchange, the stockbrokers charge a commission in helping\ninvestors buy and sell shares.<\/p>\n\n\n\n<p>When\nselecting a stockbroker, it is important to take into account the broker\u2019s\nbackground, the broker\u2019s fee, the commission charged, and kind of services it\nis providing. You can choose from full-time traditional brokers to discount\nbrokers based on your needs. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 03: Open a\nDemat &amp; Trading Account<\/h3>\n\n\n\n<p>Now\nthat you\u2019ve chosen the stockbroker, it is time to open a Demat and Trading\naccount to buy and sell shares in the stock market. There was a time when you\nsee people yelling orders on the floor of the exchange, but these days, one can\nbuy and sell shares online through a stockbroker. However, to do this, you will\nneed to open a Demat and Trading account with your stockbroker. <\/p>\n\n\n\n<p>A\nDemat account is one where the owned shares reflected in your portfolio while\nthe trading account is one which allows you to buy and sell shares or other\nsecurities in the market. The shares you buy and sell are in dematerialized\nform for online trading. <\/p>\n\n\n\n<p>In\nIndia, the National Securities Depository Limited (NSDL) and Central Securities\nDepository Limited (CDSL) are the depositories which allow investors to open\nDemat and trading accounts through brokerage firms. It is the depository\nparticipant that holds and releases the shares you purchase and sell\nrespectively. <\/p>\n\n\n\n<p>To\nopen a Demat and trading account, you need to decide on the depositories you\nwant to open your account with. Or you could just go with the broker, you want\nto open your account with and then know your depository participant later. <\/p>\n\n\n\n<p>After\nthis, you can fill the form for account opening and submit along with copies of\nthe necessary documents required to open the Demat account with your\npassport-sized photograph. Once done, in-person verification would be carried\nout and application will be processed on successful verification. Once done,\nyou\u2019ll be provided with an account number and client ID. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 04: Transfer Money in your Account<\/h3>\n\n\n\n<p>Now\nthat you\u2019ve opened your Demat and trading account, in order to buy shares\nonline, you must transfer money in your account. You can transfer the money in\nyour account from bank account by different mediums like Credit\/Debit Card,\nUPI, e-Wallet, PayPal or via bank transfer. <\/p>\n\n\n\n<p>If\nyou\u2019re planning to transfer more than 1 lakh rupees into your Demat Account\nthen you need Unique Identification Number (UIN) to do the transaction. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 05: Select the Shares you want to buy <\/h3>\n\n\n\n<p>If you\u2019ve opened your Demat account and followed the above procedure that means you have decided to start investing. Now it\u2019s time to take a dive in the stock market to find the stocks to invest in. Defining your goals is one way to select the right shares to buy. One should determine the purpose of making a portfolio. Beginner investors who are in this to buy and sell shares must focus on the overall income, expenses, and savings to ensure a consistent flow of capital for investment. Capital preservation is what beginners mostly concerned with and tend to <strong><a href=\"https:\/\/www.invest19.com\/blog\/how-safe-is-it-to-invest-in-blue-chip-stocks\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"invest in stocks of blue-chip companies (opens in a new tab)\">invest in stocks of blue-chip companies<\/a><\/strong> for safety reasons who are recognized for their stable performance throughout the years. <\/p>\n\n\n\n<p>However,\nthe investors who are in for capital appreciation prefer to invest in small and\nmid-cap stocks. So, first decides on your goals and risk appetite. Do not let\nthe volatility cloud your judgment and start with industry that\u2019s familiar to\nyou. Any beginner can become an informed investor if he\/she keeps tabs on the\ncurrent market events, day-to-day happenings in the stock market, and corporate\nevents. To do so, one should read newspapers, use stock market web-platforms\nand apps, and news channels as these are simple forms of passive research. <\/p>\n\n\n\n<p>Being\ninformed will help you in further research and understand the fundamentals\nwhich drive a particular industry. A thorough analysis can help in picking the\nright stocks to buy. There are thousands of stocks in the stock market but with\nthorough fundamental analysis, you will be left with a handful of stocks. DON\u2019T\nSWEAT!!! Because your painstaking research will come to fruition soon. Even if\nnot, you will at least able to minimize the potential risk of losing\ncapital.&nbsp; <\/p>\n\n\n\n<p>To\nbetter understand how to do a fundamental analysis of stocks in the stock\nmarket you can see <a href=\"http:\/\/www.advisorymandi.com\/blog\/fundamental-analysis-of-a-stock-in-indian-stock-market\/\"><strong>How to do a fundamental analysis of stocks\nin Indian stock market?<\/strong><\/a><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Step 06: Place your Buy Order<\/h3>\n\n\n\n<p>On\ndeciding the stock, it is time to place your order. Decides on the number of\nshares you want to buy to fill your portfolio with. Although it is all your\ndecision as a beginner it would be recommendable to start small just to feel\nhow it looks like buying individual shares. <\/p>\n\n\n\n<p>While\nyou\u2019re at it, choose the order type \u2013 <strong>market\norder, limit order, stop-loss order or stop-limit order<\/strong>. <\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"\"><tbody><tr><td>\n  <strong>Order Type<\/strong>\n  <\/td><td>\n  <strong>Description<\/strong>\n  <\/td><\/tr><tr><td>   <strong>Market order <\/strong>  <\/td><td>   It is the simplest of buy or sell orders which are to be executed at the current market prices.   It allows investors or traders to buy at the available price. While placing the market order, sometimes the price you see at the time of buy or sell is not the exact price you pay.    <\/td><\/tr><tr><td>  <strong> Limit order  <\/strong> <\/td><td>   It is the buy or sells order which is to be executed to buy or sell the shares at the specific price or better price in either direction. Investors or traders have control over the price while placing the limit order. However, the order itself cannot be executed if the underlying security does not come to the set price.    <\/td><\/tr><tr><td>   <strong>Stop-loss order<\/strong>   <\/td><td>   It is a buy or sells order which is to be executed once the stock reaches a certain price. The stop-loss order helps investors in limiting their losses on a position.    <\/td><\/tr><tr><td>   <strong>Stop-limit order <\/strong>  <\/td><td>   Similar to a stop-loss order, the stop-limit order is a buy or sells order with a limit on the price at which it will execute. Stop-limit order may guarantee a price limit however there is no guarantee that order will be filled.    <\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">Step 07: Place your Sell Order<\/h3>\n\n\n\n<p>So\nthe time has come when you decided to sell the shares you invested in. It could\nbe because you\u2019ve attained the financial goal for which you have purchased that\nspecific stock or maybe because the stock is falling from a long-time and you\ndon\u2019t plan to continue your losses in the future. Whether it is in profit or\nloss \u2013 not significant! What important for you right now is to understand how\nto sell the shares. <\/p>\n\n\n\n<p>Well,\nthe most basic way is through the market order to exit your position at the\ncurrent share price. However, even in this, you may end up selling at a different\nprice from what you expected to sell. <\/p>\n\n\n\n<p>Here,\nyou can use the limit order or stop-loss order to ensure to exit the position\nat a certain price. You can also set the no. of shares you plan to sell. Once\nthe order hits, you\u2019ll exit out of your position and the respective profit or\nloss will appear in your Demat account. <\/p>\n\n\n\n<p>If\nyou\u2019re nervous and don\u2019t fill like selling the shares then you can continue to\nhold the shares for a long-term perspective. Besides, buy &amp; hold is one of\nthe most common practices practised by many prestigious investors in the\nmarket. <\/p>\n\n\n\n<p>Hope,\nthis will help you in understanding the procedure of buying and selling shares\nin the stock market. Also, we hope it will encourage you as well to boost\nretail participation in the stock market to revive the economic growth of the\ncountry. <\/p>\n<div class='epvc-post-count'><span class='epvc-eye'><\/span>  <span class=\"epvc-count\"> 35,850<\/span><\/div><div class=\"pld-like-dislike-wrap pld-template-1\">\n    <div class=\"pld-like-wrap  pld-common-wrap\">\n    <a href=\"javascript:void(0);\" class=\"pld-like-trigger pld-like-dislike-trigger \" title=\"\" data-post-id=\"323\" data-trigger-type=\"like\" data-restriction=\"ip\" data-ip-check=\"0\" data-user-check=\"1\">\n                        <i class=\"fas fa-thumbs-up\"><\/i>\n                    <\/a>\n    <span class=\"pld-like-count-wrap pld-count-wrap\">17    <\/span>\n<\/div><\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>Being a beginner, it must be hard figuring out how you\u2019re going to buy and sell shares online and make investments to build enough wealth [&hellip;] <span class=\"read-more-link\"><a class=\"read-more\" href=\"https:\/\/www.invest19.com\/blog\/how-to-buy-and-sell-shares-online-for-beginners\/\">Read More<\/a><\/span><\/p>\n","protected":false},"author":1,"featured_media":324,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,7],"tags":[59,60,61,62],"class_list":["post-323","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock-market","category-investment","tag-selling-shares","tag-buy-and-sell-shares","tag-buying-shares-online","tag-buy-and-sell-shares-online"],"_links":{"self":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/323","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/comments?post=323"}],"version-history":[{"count":1,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/323\/revisions"}],"predecessor-version":[{"id":325,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/posts\/323\/revisions\/325"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media\/324"}],"wp:attachment":[{"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/media?parent=323"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/categories?post=323"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.invest19.com\/blog\/wp-json\/wp\/v2\/tags?post=323"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}