Process of Online Trading

Process of Online Trading

  • Author : joelle
  • Published : June 29, 2020

Internet-trading allows people to make deals on the financial market within seconds or even less. It allows you to be your boss, set your work hours, work from home, and make as much money as you want without the artificial cover placed on salaries, However, the thing that still remains the same with pre-online times is that a private trader still needs a broker in order to trade. A broker helps the trader by providing him with a trading terminal – the software that a trader uses to conduct his business.

 

It goes like this:

A trader decides to make a deal (for example, to purchase 100 shares of Mangoes). He finds the asset (Mangoes’ shares) in his online trading platform and then chooses the quantity (100 pieces or 1 lot) and places an order to buy. The broker gets a call from a trader and starts executing the order. He needs to find a counterparty – another trader, who is willing to buy the same asset for the same price.

The broker looks for a counterparty on the stock exchange. When the search is completed, the deal is made. Nowadays, the online trading platform does all the work to find a counterparty and close a deal. The trading process is fully automatic; that is why the time needed to make a deal is no more than a couple of seconds.

But it wasn’t always like this. In the early days, the whole process takes a lot of time even though the chain “trader – broker – stock exchange – broker – trader” is the same. The trader used to give a call to his broker and ask to open the deal, and the broker would personally try to find a counterparty on the stock exchange.

 

 

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The story of Dolly Khanna:

Chennai-based value investor Dolly Khanna has been trading in the Indian stock market since 1996. Mrs. Khanna’s portfolio is managed by her husband Rajiv Khanna. She made her debut through the fertilizer sector by homing in on a top-quality small-cap stock which enjoys a monopoly position. She has a talent of spotting multi-bagger stocks and knows exactly when to book profits. Emkay Global Financials, PPAP Automotives, IFB Industries, Thirumalai Chemicals are some of the picks form her portfolio.

In the last, I would like to conclude that there is no academic degree in the world that can guarantee you success in stock market. It is ultimately the experience that makes you learn.

 

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