In this era, there are hardly some businesses and jobs that satisfy the requirement of an individual, and hence the majority of the people are in search of some sources that can offer additional income. Among all such sources, the trading in the stock market is the leading one. There are people who have sound knowledge of share market and price movement. They can take it as a side business as trading in different segments of the market can help them get good profit. The market has segments such as derivatives and cash where one can trade. In the cash segment, the trader can go for the intraday trading or delivery based while in the derivatives he can go for either options or futures.
Which account can be beneficial?
Well, in the world of trading in the stock market, there are offline as well as online accounts. One needs to check the benefits and limits of trading through both of these accounts as per his situation and requirement. In the routine days, if one is busy during market session, it is better to go for the offline account where a terminal operator needs to be contacted and asked for placing the order. The client can also ask him about the movement of market and rates of various shares. He can also ask the operator to set limits for booking of profit or stopping the loss. The operator can work as per the instructions of trading by the client and needs to follow the same. He also helps the client knowing his account position and gets the fund transferred from his trading account to his bank account.
There is also online account where the trader needs to trade himself. He needs to know how to place an order for buying and selling the shares and set various limits. He needs to place the order on his smartphone with the help of an application or on the computer after logging on the site of the service provider. In both of these accounts, one needs to pay a certain amount to the broker that is called brokerage. Some of the brokers also offer plans with zero brokerage these days, but for that, the client needs to fulfil some of the conditions mentioned in the account opening form. Hence the client needs to go through the account opening form thoroughly before signing the deal.
Which segment should one go for?
This is a matter of the choice and preference of a trader. One needs to check his interest, risk-bearing capacity and knowledge of the concerned segment. Sometimes traders think that the derivatives are the segment where they can earn more profit, but at the same time, he should know that it involves more capital and risk of more loss is also there. On the given date of expiry of contract one must square off the position else, it will be automatically squared off by the system at given rate. Hence one wrong trade here can lead to a huge loss also in the case of derivatives.