Equities Trading_ An Easy-to-Read Complete Guide to Equities Trading for Beginners
                     An Easy-to-Read Complete Guide to Equities Trading for Beginners
Description
Equity is an asset class. Just the way you open a fixed deposit with the bank or visit a jeweller to 
buy gold, you trade in equities in the stock market. Here are the equity trading basics if you are 
starting your journey as an equity investor.
What is Equity Trading? 
Equities are company shares you can buy or sell on the Bombay Stock Exchange (BSE) and 
National Stock Exchange (NSE). This is called equity trading. 
Why Should You do Equity Trading? 
The main aim of any equity trader is to buy at lesser prices and sell at a higher price to earn 
profits. Some benefits are listed here:
 
● Better Returns: The equity market investment usually gives higher returns than other 
markets in the long term and during inflation. Hence, they are popular among investors 
looking for growth funds.
 
● Diversification: Equities are an intelligent way to diversify your investment portfolio and 
maximize risk-return tradeoff.
 
● Dividends: Some companies also distribute their profits in the form of dividend income to 
their shareholders. This is an additional, unexpected income source for equity traders.
● Bonus Shares: Some companies even offer bonus (free) shares instead of dividends.
● Right Shares: Companies issue rights shares for capital expansion or other business needs. 
You can also get the priority privilege of buying right shares at a lower price before they are 
opened for the public at a higher price. 
 
● High Liquidity: You also get high liquidity in equity as compared to other financial instruments 
in the market. A majority of equity stocks do not have a lock-in period.
How to Do Equity Trading? 
You need to open a Demat account for equity trading. You can then start buying and selling 
stocks online in the dematerialized form or electronic format. Please note that you have to contact 
a registered stockbroker to open a Demat account. You also need an online broker platform to 
view all the stocks and buy or sell as per your requirement. The claim and settlement cycle is 
usually T+2 days and runs like a well-oiled machine.
What Things do You Need to Bear in Mind While Trading in Equity?
While the Securities and Exchange Board of India (SEBI) governs equity trading and stock 
markets, they are vulnerable to market volatility. Hence, you must have sound knowledge of the 
stock markets. It would also help stay updated with the latest industry news and other factors that 
influence the stocks. Or else, you might incur losses. 
It is also a good idea to pay attention to market sentiments and avoid following the herd mentality. 
Do your research and talk to stock market experts before you take any decision to buy or sell.
As a beginner, it is always recommended to connect with an equity investment advisory firm. An 
advisory firm can understand your investment objectives, risk appetite and budget, and provide 
the necessary advice. It can guide on what and when to buy or sell. It can professionally manage 
your equity portfolio.
Lastly, remember that you should always do equity trading with a long-term horizon to reap the 
maximum benefits.
THANK YOU !
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mplete-guide-to-equities-trading-for-beginners