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Q:
ABOUT TRADING
Importance of
Agreement with the Constituent
A:
An investor has to
choose broker with whom he wants to trade with and enter into
broker-client agreement. The investor should carefully read
various terms and conditions and understand their implications
before entering into an agreement with a member/broker. This
agreement is mandatory. The features of this agreement which
reduce the chances of any dispute on terms and conditions which
relate to placement of order, trade confirmation, brokerage
charges by a broker and delivery of securities and payments.
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Q: Mechanics of
Share dealing
Buying Directly
A: When an
investor has decided to buy shares in a particular company, he
contacts his broker. He can place an order to buy a fixed number
of shares, or shares upto a certain value.
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Q:
Selling Directly
A:
Again the investor contacts
his broker. The stock broker is obliged to sell at the best price
he can get, but an investor can decide what is the minimum he is
prepared to accept.
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Q:
Dealing with advice
A: The stock broker assists the
investor in buying and selling of shares but in no way he is under
any obligation to supervise the investment or to advice or make
any recommendation to the investor/clients with respect to the
sale/purchase shares.
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