FAQ on Stocks

How can one buy a stock from the stock market?

One has to open two different types of accounts to get involved with buying and selling of shares on a stock exchange. The first is called a DEMAT Account (Depository Account) and the other is called a Trading Account. The depository account is like a savings bank account in a bank wherein shares are credited and debited depending upon whether they are bought or sold. The shares are bought and sold through the Trading Account.

The Trading Account is an agreement between the person willing to buy and sell shares and a registered stockbroker. The agreement gives right to the broker to buy and sell shares on behalf on the client. Once the shares are bought he credits the shares to the DEMAT account of the client. If the client wishes to sell the shares then he has to inform the broker. The broker will sell the shares on the exchange and debit the DEMAT account with the number of shares sold.
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