Iguess by now you must have understood the various business terminologies in financial news I am sure you do. Now, you won't find business news hard to decipher. In this issue of the magazine, I will try to explain the process of investment. The only things required to know are the four basic steps of investment. Read on! STEP ONE- SELECTING A BROKER. While entering the share business, the first step to be taken by you will be to choose a reliable broker or subbroker who will carry out your transactions in satisfactory manner.You can get a list of brokers and sub-brokers from the stock exchanges or from their websites. Some of the important websites are: · www.bseindia.com · www.nseindia.com · www.sebi.gov.in · www.indiabulls.com · www.investsmartindia.com It is important to spend time and effort in verifying the background of the broker or sub-broker with whom you intend to deal. It is so, because only a good broker will make it easier and more profitable for you to transact business on the stock exchange.Most investors believe that the broker's job is to provide advice and tips on what to buy and sell. But, this is simply spurious. There is strong possibility that any advice coming from a broker could be biased and shortsighted. A broker's job is only to execute your transaction and to provide you with all necessary documentation. STEP TWO- OPENING A DEMAT ACCOUNT. The second step is to open a demat account, with your selected depository participant (DP). Most of the time, depository participants are banks, financial institutions and brokers. Dealing with a DP in depositing and withdrawing your demat shares is quitesimilar to operating a bank account. Selecting a depositary participant is not a big deal, but the best way is to deal with the same DP as does your broker. This will make your share transactions easier and speedier. STEP THREE- BUYING SHARES. This is the most important stage- to buy shares. When you buy shares, immediately you will get a contract note/ confirmation memo for the purchase of shares from your broker or sub-broker.Then the shares you have purchased will first come to the demat account of your broker. For receiving shares in your demat account, you will have to give the details about your demat account to your broker .After that, it will be transferred to your account. STEP FOUR- SELLING SHARES. If you want to sell shares, it is required that you instruct your DP to transfer the number of shares that you have sold from your account to the demat account of your broker. For this, it is important to add the details of your broker's demat account in the instruction slipthat you have to give to your DP. The instructions will be in technical in nature, so the broker will help you to fill it. The point to be noted is that, this delivery instruction forms differ from DP to DP. To all of you out there seeking to make the best of your hard earned money, follow these four easy steps, along with your eyes and ears open towards the company's performance in which you are interested to invest; I am sure you will earn profit out of it.I wish you all the best of luck in your endeavours in the New Year 2008.
Shivani. MS (Communication)
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