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जुलाई 24, 2015 की पोस्ट दिखाई जा रही हैं

About Brokers and Discount Brokers India

If you have a large trading account and fear that your broker will run away with your money or do trading on your account without your knowledge then you need not fear. The rules by SEBI (Securities and Exchange Board of India) are so strict that the brokers actually fear trading without your permission in your account. The rules governing management of money in brokers account are even stricter. According to a recent rule any money that is not used in a Demat account needs to be returned to the client. Earlier if you remember the brokers used to keep the money in your trading account. You could have used that money any time you want or leave it idle. But now rules have changed. The money that is not blocked or used for a certain time needs to be returned to the client's bank account. This is to ensure in case you had left a lot of money with your broker and God-forbid some thing happens to you, all the money that is unused will be refunded. In many cases family members do not know...

Why Two Trading Accounts?

Why Two Trading Accounts? You must have 2 trading accounts. One should always be used for long term stock investments. For example make a list of companies that you think will be multi-baggers in a few years and start a SIP (systematic investment plan) in them. Let say you invest 3000 every month in rotation on the 1st of every month in 5-10 companies of your choice. Lets say at an average return compounded annually these companies return 15% CAGR (some stocks return more), then in 31 years you will have more than 2 crores in your kitty. More than enough for your retirement from one account itself for a small investment of just Rs. 3000/- per month. Remember you can make much more if one of the stocks behaves like ITC or a Wipro . The other account should be for F&O trading purposes only. Now here is some magic. Lets say you start with 2 lakh only and do not add a single paisa to that account ever. Now lets assume you make just 24% CAGR (Compound Annual Growth Rate – only 2% a mont...