Planning to make your first trade in the stock market? That is a smart step, as trading offers a chance to earn profits from market movements, get real-time market experience, and work towards financial independence. However,since you are a beginner, it’s essentialto understand the basics before you place your first order. After all, in your trading journey, you will come across both highs and lows, as well as moments of success and loss.
Look at what you need to check to make sure your first trading experience is informed, confident, and on the right track.
Open a demat and trading account
In order to buy or sell shares, you need to have a:
- Demat account: Keeps your shares electronically.
- Trading account: Used to place buy/sell orders in the share market.
You don’t need to open them separately. Most brokers provide both accounts together as a package.
A reliable stock market app usually lets you open your demat and trading account in only 15 minutes using your Aadhaar, PAN, and bank details. Ensure the platform also offers transparent pricing, user-friendly features, and helpful tools so you can trade confidently and learn throughout your share market journey.
Grasp the basics
Share prices fluctuate based on company performance, economic factors, global events, and market sentiment. Utilise resources offered by a stock market app, like FAQ sections, articles, and educational videos, to learn how the market works.
Many apps even offer free demo accounts where you can practise trading with virtual money. These can help you get comfortable with trading and basic order types like overnight, limit, market, slice, or Good-Till-Date (GTD) orders.
Understand the ratios
As a beginner, it helps to understand key ratios like:
- Price-to-Earnings (P/E) ratio: Tells if a stock is costly or inexpensivecompared to its earnings.
- Earnings Per Share (EPS): Shows the company’s profit divided by the number of shares.
- Dividend yield: Reveals how muchyou will get as dividends.
- Price-to-Book (P/B) ratio:Measures how a stock’s current price relates to the company’s book value (net assets per share).
- Debt-to-Equity (D/E) ratio: Shows how much the company depends on borrowed money versus its own funds.
Each ratio gives a different perspective on a stock’s value, profitability, or risk and helps you trade more confidently.
Learn the purpose of different order types
Before your first stock trade, knowing basic order types matters. If you just hit “buy,” you might pay more than expected in a fast-moving market.
Take a look at some basic order types like market and limit orders. These order types control how and at what price your trade is executed. For example, a market order buys or sells immediately at the best available price, while a limit order lets you set your own price.
Having a grasp of these options can protect you from surprises, help you avoid costly mistakes, and give you more control over your trading experience.
Make your first trade now
Here is how you can place your first trade online hassle-free:
- Open a share market app.
- Search for the stock you wish to buy.
- Enter the quantity or number of shares you want to purchase.
- Choose order type (e.g., market).
- Add funds securely via UPI or net bankingand finalise the transaction.
Afteryour order is executed, your demat account will reflect the shares you now own.
Closing note
The stock market for beginners often seems complex at first, but the basics make it far more approachable. You need to open a demat account through a trusted app first. As you get started, make the most of educational resources and demo accounts to learn the basics of how the market works, how to read key financial ratios, and how to use different order types. With all this, you can confidently make your first trade, manage your risks, and build your skills over time.
For an informed and hassle-free stock trading journey, choose MO Riise. Backed by the legacy of Motilal Oswal, a SEBI-registered public entity, more than 40 lakh traders use MO Riise. Get access to real-time insights, high-quality expert-backed research on stocks, powerful analysis tools, UPI-based payments, learning resources, and 24/7 assistance. Moreover,access to StoCoMo, an in-app community of traders and experts, helps you grow as a trader.
Download MO Riise today to begin trading confidently!
