Steps are involved in the screen-based trading for securities

This is the topic of chapter - Financial market for class 12 Business Studies

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Steps are involved in the screen-based trading for securities

By Mamta narula
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This is the topic of chapter - Financial market for class 12 Business Studies
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  1. Steps are involved in the screen-based trading for buying and selling of securities

    Slide 1 - Steps are involved in the screen-based trading for buying and selling of securities

    • Ch-10
    • Financial Market
  2. Step 1Selection of broker

    Slide 2 - Step 1Selection of broker

    • PAN number (This is mandatory)
    • Date of birth and address.
    • Educational qualification and occupation.
    • Residential status (Indian/NRI).
    • Bank account details.
    • Depository account details.
    • Name of any other broker with whom registered.
    • Client code number in the client registration form.
    • Provide certain other details and information
    • Broker opens trading account in the name of the investor.
    • Approach a registered broker or sub-broker
    • Sign a
    • Broker-client agreement
    • and
    • Client registration form
  3. Step 2Opening of Demat Account

    Slide 3 - Step 2Opening of Demat Account

    • Open a bank account for cash transactions
    • Go to
    • depository participant (DP)
    • Open a ‘demat’ account
    • or
    • ‘beneficial owner’ (BO)
  4. Step 3Placement of Order

    Slide 4 - Step 3Placement of Order

    • Give Clear instructions about the number of shares
    • and
    • the price
    • Go to
    • broker
    • Places an order
    • to buy
    • or
    • sell shares
    • Broker gives
    • order confirmation slip to the investor
  5. Step 4Execution of Order

    Slide 5 - Step 4Execution of Order

    • Match the share and best price available
    • Broker will go on-line
    • Connect to the main stock exchange
    • Order will be executed electronically
    • Broker gives
    • order confirmation slip to the investor
    • Within 24 hours the broker issues a Contract Note
  6. Date and time of Trading

    Slide 6 - Date and time of Trading

    • Contract Note
    • brokerage charges
    • number of shares bought or sold
    • A Unique Order Code number
    • price
  7. Step 5Settlement of Order

    Slide 8 - Step 5Settlement of Order

    • Selling Shares
    • Buying Shares
    • Pay in day
    • Pay Out day
    • Shares are delivered
    • Payment received
    • Cash is paid
    • for shares
    • Deliver the shares
  8. SELLER

    Slide 9 - SELLER

    • BUYER
    • Stock exchange
    • Selling Shares
    • Buying Shares
    • Settlement cycle
    • T+2 day
  9. Suppose, an investor, Shyam buys 100 Reliance on Monday i.e. T day @ Rs.2600. His net obligation on Tuesday would be to give Rs.2,60,000. On Wednesday i.e. T+2 day, he will receive 100 Reliance in his Demat account

    Slide 10 - Suppose, an investor, Shyam buys 100 Reliance on Monday i.e. T day @ Rs.2600. His net obligation on Tuesday would be to give Rs.2,60,000. On Wednesday i.e. T+2 day, he will receive 100 Reliance in his Demat account

    • Settlement cycle
    • T+2 day
  10. Step 5Delivery of shares

    Slide 11 - Step 5Delivery of shares

    • Investor give details of his
    • demat
    • account to broker
    • Instruct his depository participant to take delivery of shares