A share is nothing but a part of the ownership of the company issued to the general public to raise capital. So when you buy shares of a company, you become the owner of that company proportional to the value of shares
There are two most important reasons to buy shares online
Capital Appreciation:
Capital Appreciation is an increase in the value of a stock over a period of time. Technically speaking, capital appreciation is the difference between the purchase price and the selling price of the stock.
DIVIDEND INCOME:
A dividend is paid by the company to its shareholders every year. It is a part of the company’s cash reserves or profits. The companies don’t have an obligation to pay dividends to their shareholders.
Myth: More than 90% of people think dividends are paid only when the company makes a profit. It is not true, companies with good cash reserves pay dividends even if they are not making any profits.
How to Buy Shares Online
STEP 1: APPLY FOR A PAN CARD
Firstly, you need to apply for a PAN Card if you don’t have one. Here are some of the uses of PAN Card
PAN Card is a must-have to make any financial transactions in India.
PAN Card acts as a valid identity proof.
Can be used to file Income Tax returns.
Mandatorily required to Open Savings Account, Trading & Demat Account, etc
STEP 2: OPEN A SAVINGS ACCOUNT
Once you have got the PAN Card, you need to open a Savings Account with the bank of your choice.
In investing, the savings account is needed to transfer the money into the Trading account.
STEP 3: FIND THE RIGHT STOCK BROKER
A stockbroker is an organization whose primary objective is to provide a Trading and Demat account to help investors in buying and selling stocks or any other financial instruments.
What is a Trading Account?
It is an account that allows you to buy & sell financial instruments listed in the stock market.
What is a Demat Account?
The Demat account helps you store the financial instruments bought in the stock market in an electronic form.
Confuse to Find the Right Stock to Invest in? Get through this How to buy shares online to know more .
