Mar 21, 2024 Value Broking 8 Mins 1.5K

If you zoom out and look at the all-time price chart of the Sensex or Nifty 50, you will see that the value of these indices has increased over time. It is because the stock markets are ever-growing entities. The biggest companies and conglomerates successfully scale up over time. New companies also develop their IPOs and list the changes, attracting new investors and traders.

However, the stock market has not only evolved in terms of its sheer size. The advancement of technology has also led to a revolution in the trading system. As a result, the trading and investing processes are steadily shifting from offline to online.

What is Online Trading?

Online trading entails buying and selling shares or other financial assets on the stock exchange via the internet using devices like smartphones, tablets, or laptops. An online stockbroker, who acts as an intermediary between the investor and the exchange, provides a platform to trade. In addition, they provide Demat account services and trading account services that are mandatory to trade shares online.

With online trading, it is much faster as compared to offline trading. Therefore, it is good to find better securities for your investments. Receiving a quick update from these, from price changes to price alerts, you can get all the updates from online trading platforms. Investments are not like the olden days; buying or selling shares starts with a very low price and size.

One can open these accounts online by visiting the stockbroker’s website. Once the verification process is complete, one can trade online from anywhere, at any time during the market hours. When one trades online, place their order using the online trading platform.

Understanding the Offline Trading Process

Before the internet revolution, trading in the stock market was purely physical activity. The execution of trades would take place inside the stock exchanges. To trade at the exchanges, an individual had to contact a stockbroker, but back then, the stockbroker would have to go to the stock exchange and place the order physically. An offline trading cycle starts with the investor calling their broker or office.

The investor would then ask their broker to place an order at the exchange. The broker would then go to the exchange and place the order. If the execution of the order is successful, the broker will receive the physical shares. On the other hand, if the investor demands a delivery, the broker would then deliver these shares to the investor. Or else, the broker would sell the shares at the exchange upon receiving instructions from the investor. This process was lengthy and could take days.

Difference Between Online Trading and Offline Trading

Here are the following essential key factors to understand online trading vs. offline trading.

Particulars
Online TradingOffline Trdaing
Simple TradingTrade conveniently without a broker’s aid.A broker is used for all transactions. One is dependent on a broker’s services.
PlatformUtilise a single platform to get research on and make investments in many asset classes, such as shares, commodities, etc.Conduct your research and due diligence before requesting the broker to execute the deal.
Trading ChargesDue to lower brokerage fees and costs, online trading generates higher returns.Brokers frequently impose astronomical fees. The high brokerage fees and expenses might negatively affect your profitability.
Current InformationTrading professionals may benefit significantly from real-time updates on stocks, securities, and markets. Through Internet trading platforms, such information is readily available.Information is frequently shared with a delay, and most of the time, real-time information is not given.
FraudThe almost nonexistent danger of potential fraud. Multiple levels of protection are used to secure online trading accounts. The regulator, SEBI, actively foresees and closely monitors potential fraudulent practices.Due to insufficient checks and balances, false impersonation and document forgery are both feasible.
Knowledge and ExpertiseYour broker provides access to excellent and in-depth research reports and analytical insights (including fundamental and technical analysis). These support you in making wise, knowledgeable investing choices.Depending on the specific circumstances. If your broker has a lot of expertise and experience, they could be able to provide you with some helpful advice.
SpeedYou may finish your transactions quickly because everything is digital, and no physical paperwork is required.Transaction processing speed is substantially slower as a result of heavy manual involvement.

What are Some Online Trading Platforms?

Over the years, the Indian stock market has expanded substantially, and along with that expansion, several trading platforms have evolved to meet the demands of Indian investors.  The top five Indian Internet trading platforms are shown below:

1. The Angel Broking

Since 1987, India has been home to full-service broker Angel Broking. It provides many different investment choices, such as stocks, derivatives, mutual funds, and bonds. Angel Broking is renowned for having a user-friendly design, cutting-edge graphing tools, and research reports.

Its trading platform also offers real-time data and a selection of order types. With all the capabilities of the desktop platform in a simple and user-friendly manner, Angel Broking’s mobile app is as well-regarded. The costs charged by Angel Broking range from 0.04% to 0.50% and are based on a percentage of the transaction amount.

2. 5Paisa

Another well-known discount broker, 5Paisa, provides inexpensive brokerage costs and an easy-to-use interface. Stocks, derivatives, mutual funds, and bonds are just a few investing alternatives it offers.  The trading platform of 5Paisa offers a range of order types, sophisticated charting tools, and real-time data.

Additionally, it enables traders to set up personalised price notifications and make trades with a single click. Additionally, the platform has a special function called TradeStation that enables traders’ real-time market updates and analysis. The pricing model for 5Paisa is based on a fixed cost per trade of 20 rupees or 0.05% of the transaction value, whichever is lesser.

3. Sharekhan

Full-service broker Sharekhan has been in business in India since 2000. Stocks, derivatives, mutual funds, and bonds are just a few investing alternatives it provides. Sharekhan is renowned for its user-friendly design, research reports, and sophisticated charting capabilities. Additionally, real-time data and a range of order types are available on its trading platform.

 The Sharekhan mobile app is equally well-regarded and provides all the functionality of the desktop platform in a simple and handy interface. Fees for Sharekhan’s services range from 0.10% to 0.50% and are based on a percentage of the transaction amount.

4. The HDFC Securities

A full-service broker, HDFC Securities is a member of the HDFC Bank group. Stocks, derivatives, mutual funds, and bonds are just a few investing alternatives it provides. The user-friendly interface, cutting-edge charting tools, and research reports of HDFC Securities are well-known. Additionally, real-time data and a range of order types are available on its trading platform.

The mobile app for HDFC Securities is equally well-regarded and provides all the functionality of the desktop platform in a practical and straightforward manner. Fees at HDFC Securities range from 0.05% to 0.50% and are based on a percentage of the transaction amount.

5. The ICICI Direct

The ICICI Bank group includes the full-service broker ICICI Direct. Stocks, derivatives, mutual funds, and bonds are just a few investing alternatives it provides. The user-friendly interface, cutting-edge charting tools, and research reports of ICICI Direct are well-known. Additionally, real-time data and a range of order types are available on its trading platform.

The ICICI Direct mobile app is equally well-regarded and provides all the functionality of the desktop platform in a simple and intuitive interface. Fees for ICICI Direct range from 0.25% to 0.75% and are based on a percentage of the transaction amount.

Conclusion

Online trading has made trading more convenient, quick, and accessible. It has helped reduce the number of malpractices in the stock market. Online trading has eliminated the requirement to maintain physical shares. The online trading system reduces human errors and flaws that can harm the trade. Different brokers offer investment directly in the financial market. You can choose any desired broker as per your need.

Online trading can get you one of the top research stock recommendations after sorting each broker service based on its service charges, offers, and trading platforms. It provides you with a report and analysis of stock prices according to various methods. In addition, there are various resources and websites available on the internet.  You can take the help available online or hire a professional advisor to perform your daily trading.

Today, one can still trade offline through an offline broker. The internet is yet to penetrate a few regions in the country, so some people only have offline access to the stock market. However, online trading replaces offline trading as more people gain internet access.

Frequently Asked Questions (FAQs)

In trading, when one opts for delivery of shares, the shares get stored in the investor’s Demat account, in the case of online trading.

T+2 days simply mean that if a trader opts for delivery, the shares will get delivered in their Demat accounts within two trading days, post the date of the transaction.

Yes, online share trading is safe and secure. The broker app and the government Depository system are well made. They have multiple layers of protection to provide safe trading and work for the benefit of both traders and the companies listed in the share market.

Yes, It saves time and is convenient.