Trading in the Stock Market has seen revolutionised changes over the past few years. Today, you no longer sell or buy shares over calls with physical papers. Stockbrokers have a digital presence and provide an online platform for trading. They also have advanced technology to track the market trends and invest accordingly. Another benefit transcends to the maintenance of Shares and Securities.
You open a Demat Account to store your securities in a digital format. All your holdings get managed in one place for your convenience. They also enable seamless transfer of funds by linking them with a Trading Account. However, instances of fraud are not uncommon in the Stock Market. Some scams are inevitable despite the Securities and Exchange Board of India regulations. In such cases, take the following safety measures:
Track account record
Like tracking your banking history, check the transaction statement for shares regularly. It provides a complete overview of all the transactions you do. If you cannot access it, contact your brokerage firm for guidance. This, coupled with tracking the market insights and fluctuations, is a good practice. You spot any discrepancies on time to take immediate action.
Scrutinise brokerage firm
With the popularity of Stock Trading, the number of brokerage firms is growing. Today, you find many firms with competitive rates and services. However, not all are creditworthy. Hence, do a background check before opening a Demat Account with them. Verify brokerage companies based on their record, reputation, support services, and customer experiences.
If you have long-term investments, it is easy to forget about them. You may not look at your account statements or stock movement. While you should invest and fail, it is not wise to stop checking their status. Even if you do not engage in regular trading activities, ensure to get insights on your holdings regularly. You do this through apps and trading platforms. In case of non-usage, you may freeze the Dematerialised Account.
Power of Attorney
According to the agreement terms, most brokerage firms act as a Power of Attorney. This means they get to access Demat Account besides you. Here, you exercise caution with what the power entails. Instead of one-time signing off, read the agreement carefully. If allowed, go for limited purpose Power of Attorney. According to this, the brokerage firm needs to seek consent before buying, selling, or transferring on your behalf.
Leverage security features
You get a security facility via passwords and notifications when you open the account. Use them to secure your shareholdings. Create a unique password with complex combinations. Avoid using generic ones that are easy to guess, and they should not relate to your interests. Also, stay updated with real-time SMS notifications to spot irregularities and fix them timely.
It is best to follow these safety tips regardless of your trading activities.
Disclaimer – ICICI Securities Ltd. ( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. – ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai – 400 025, India, Tel No : 022 – 6807 7100. The contents herein above shall not be considered as an invitation or persuasion to trade or invest. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The contents herein above are solely for informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments or any other product. Investments in securities market are subject to market risks, read all the related documents carefully before investing. The contents herein mentioned are solely for informational and educational purpose.