Online Trading – A Basic Understanding
August 23, 2018
Today is a universe of innovation. The people who adopt with this innovative technology become successful in their life. Nowadays online trading has become popular for all age groups. The trading which is done through electronic means is known as online trading. The trading process can be done by any person with basic knowledge of internet and computer through which one can invest their money in the stock market. The trade can be done at any time, at any place when the stock market is open. The transaction cost is reduced with time. A large number of options is available for investors. The online trading is a paperless exchange so it lessens the expense of the company. The vast majority of the trading portals charge a basic registration fee and brokerage on different conditions however it is essential for the organization to keep focused on client-centered activities it helps to be in attendance.
Characteristics of Online Trading
- The product cost would be less by reducing the supply chain network.
- Enhance better customer service.
- Customer service is available for twenty for hours a day, seven days in a week and moreover three sixty-five days in a week.
- It is easily accessible than the traditional
- It always gives the latest up-to-date on products.
- It identifies the market trends and produces new products depending on the customer’s
What is the Process Involved in Online Trading
The online trading activity is only done through the internet without physical inclusion. The investor should register in an online portal. By this, the investor makes an agreement with the firm and the terms and conditions included in the agreement. After registration, the online trading portal servers are connected at any time with the stock exchanges and selected banks for processing the order at a time. The investor always gets the current status of orders and updates via e-mail or through the interface. The important thing is that the system should interface directly with the exchange without any issues. The data which transferred must be safe and cannot be accessed by any other person. Nowadays the private bank sectors offer three in one accounts which link your trading account to savings banks and demand accounts for an easy transaction. And also provides a single window system for all transactions and a single screen for the completion of the order process. It gives an offline-storage facility which backed up periodically.
Online Transaction – The Future
Online trading allows more and more investors and sellers to carry out transactions which in turn help the financial institutions by helping the stock market to reach its goal. Although market fragmentation may occur due to entering of too many competitive suppliers, its effect may not be long-lasting as more and more people start using the internet to trade, the number of suppliers and consumers would even out. The future trend shows that the number of inexperienced investors using online trading will increase due to ease of convenience and publicity. Such new entrants would require knowledge and advice from e-brokers and learn more about it, online investing firms will have to provide more personalized service.