Online vs Offline Trading

 

If you want to trade in share markets, you should have a good grasp of the fundamentals of share trading. One such aspect is knowing the difference between online and offline trading.

As you cannot trade directly in stock markets, you have to approach a broker/broking platform. Before the internet, there was no other option, but to make sales/purchases of stocks and securities through a broker, who was either an individual or a firm. For this, you were required to make a physical visit to the broker’s office, where the broker would trade on your behalf. The advent of the internet has made everything online. Now you can trade conveniently through online trading accounts.

Here is a look at the differences between Online and Offline Trading:

  Online trading Offline trading
Ease of trading Trade conveniently, without any assistance from a broker. All trading is conducted through a broker. One is completely dependent upon the services of a broker.
Convenience of trading You can trade from anywhere and at any time through your internet-enabled device like smartphones, tablets, laptops or PCs. You are required to physically visit the broker’s office for call and trade, and other trading-related activities.
Trading fees Online trading makes more profits via trading because of fewer brokerage charges and fees. Many brokers charge exorbitant fees. The high brokerage charges and fees can negatively impact your profits.
Platform You get a single platform to do research and trade in shares and securities. You need to do independent research before asking the broker to trade.
Quality of advice You can access detailed reports with patterns, trends and price movements to make informed choices regarding stocks and securities. You need to have implicit trust in the broker. The broker’s word-of-mouth recommendations have to be followed.

Is Offline Trading Still Possible?

Trading in the stock market can still be done offline. However, it has lost its sheen, and relevance because of the manifold advantages of online trading.

What are the Additional Benefits of Trading via an Online Trading Account?

  • Access to real-time information:This key benefit of online trading means that you receive regular updates about the movement of stocks and securities. Many financial companies regularly analyze the various dynamics of the market and provide you with updates on a daily or weekly basis. This makes you aware of the existing and emerging patterns/trends in the market. Access to real-time information through an online trading account helps you build an effective portfolio.
  • Prevention of fraud:Your online trading account is protected by several layers of security. It is virtually impossible to hack your trading account to avoid malpractices. Digital transactions also prevent fraudulent activities like impersonation or providing forged documents. Additionally, online trading is closely monitored by the Securities Exchange Board of India (SEBI).

What are Some Online Trading Platforms?

Once you open a trading account, you receive access to different types of online trading platforms:

  • Desktop trading software - This is a type of trading software, which has to be installed on your PC or laptop. You require an active internet connection to operate the software. It simulates terminal-based trading once installed. This software has many features to help you make informed decisions about share trading.
  • Browser/Web-based platform -This platform helps trade directly on the stockbroker’s website, with minimum internet and no downloads. You can get access the financial services from web-based platforms. These include purchasing Initial Public Offerings (IPOs), investing in Mutual Funds or bonds, and trading in derivatives. The key highlight of this platform is the instant execution of orders along with quick settlements.
  • Mobile-based trading app - Mobile-based apps for both Android and Apple smartphones are available. The advantage of these online trading apps is that they allow you to trade on the go. You can do share trading from anywhere, and at any time.

Conclusion

Thus, online trading has made share trading easier, convenient, quick and hassle-free. Firstly, open a trading account from a trusted financial partner, who can provide a single platform for different investment options. Besides, you must ensure the best stock and scheme recommendations to enable maximum profit booking.