#Best NRI Demat & Trading Account

[farsightgroup]

Demat of Foreign corporate account (OCB) / Overseas Corporate Body | Farsight Shares

Introducing Farsight Shares, a trusted platform for managing your Demat of Foreign corporate account (OCB) / Overseas Corporate Body. Our cutting-edge technology and personalized services ensure a seamless experience for investors looking to diversify their portfolios internationally.

Click here: https://www.farsightshares.com/

[dailygong1]

How 9 Things Will Change the Way You Approach Best NRI Trading Account In India

Sure, here are 9 things that will change the way you approach the best NRI trading account in India:

You can now open an NRI trading account online. This was not always the case, as NRIs had to physically travel to India to open a trading account. However, with the advent of online trading, NRIs can now open an account from anywhere in the world. This is a major convenience, as it saves time and money.

You can trade in Indian stocks and derivatives from anywhere in the world. This is another major benefit of online trading. NRIs can now trade in Indian stocks and derivatives from their home countries, which gives them access to the Indian market. This can be a great way to diversify their investments and take advantage of the growth potential of the Indian market.

You can access a wider range of investment products. NRIs who open an online trading account will have access to a wider range of investment products than those who open a traditional trading account. This includes stocks, derivatives, mutual funds, and bonds. This gives NRIs more flexibility in their investment strategies.

You can benefit from lower brokerage fees. NRIs who trade online can benefit from lower brokerage fees than those who trade through a traditional broker. This is because online brokers typically have lower overhead costs. This can save NRIs a significant amount of money on their trading costs.

You can enjoy faster trade execution. Online trading platforms typically offer faster trade execution than traditional trading platforms. This is because online platforms can process trades more quickly. This can be a major advantage for NRIs who want to take advantage of short-term trading opportunities.

You can get access to real-time market data. Online trading platforms typically offer access to real-time market data. This means that NRIs can see the latest market prices as they happen. This can be a great way to make informed trading decisions.

You can trade in multiple currencies. Some online trading platforms allow NRIs to trade in multiple currencies. This can be a great way to hedge against currency fluctuations.

You can get support from a dedicated team of experts. Most online trading platforms offer support from a dedicated team of experts. This can be a great resource for NRIs who are new to trading.

You can enjoy the convenience of online trading. Online trading is a convenient way to trade in the Indian market. NRIs can trade from their home computers or mobile devices. This can save them time and hassle.

These are just a few things that will change how you approach the best NRI trading account in India. If you are an NRI who is interested in trading in the Indian market, I encourage you to open an online trading account. You will be glad you did.

Here are some additional tips for choosing the best NRI trading account:

Consider the brokerage fees. This is one of the most important factors to consider when choosing an NRI trading account. Make sure to compare the brokerage fees of different brokers before you decide.

Consider the investment products that are available. Ensure that the broker you choose offers the investment products you are interested in trading.

Consider the trading platform. The trading platform is the software that you will use to trade. Make sure that the platform is user-friendly and easy to navigate.

Consider customer support. Make sure that the broker you choose offers good customer support. If you have any questions or problems, you want to be able to get help quickly and easily.

For More Info:

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Zerodha Discount Broker Review 2020: Compare Broker Online

Zerodha with a one of a kind name and significance, Zero + rodha (Barrier in English) is developing as the single largest discount broker in India you will see in this    zerodha discount broker review 2020. The reason Zerodha turning into the best trading platform in India is expected to giving “the best internet exchanging stage India”, “low brokerage and high presentation”, “free direct shared reserve venture stage” and “effective client assistance.”

In only a limited capacity to focus time (9+ years) Zerodha top the list to become the best stock broker in India as far as dynamic customers. Zerodha contributions & backing is developing step by step.

The principle contributing exercises offered by Zerodha are exchanging value, value F&O, ware, cash on NSE, BSE, MCX and MCX-SX and interest in Direct Mutual Funds through SIP and single amount, ETFs, Government protections, and securities.

Zerodha offers free exchanging value delivery and charges a low brokerage of Rs 20 or .03% whichever is lower for exchanging value Intraday, F&O, cash, and ware.

The Demat administrations provided are of being a DP of CDSL. Furthermore, there is NRI trading facility at Rs 200 or .1% per request whichever is lower for value conveyance and Rs 100 for each request for value F&O.

Zerodha Mutual Fund Investment

This is the first broker in quite a while to offer a Direct Mutual Fund investment facility to its clients for nothing.

In this, you can put resources into direct shared store plots that give you better returns contrasted with customary common reserve plans.

Fundamentally, there is no commission setting off to the brokerage house from your common store speculation.

Zerodha Account Opening Process and 3-in-1 Account

You would instant be able to open records with them. The advantages of 3-in-1 record are offered in tie-up with IDFC First bank in the structure of Zerodha-IDFC FIRST Bank 3-in-1 record.

The business as usual of the record – a solitary record comprehensive of exchanging, DEMAT and financial balance for consistent and bother free web based banking and contributing experience. It has now become the exchanging and self-clearing part to give customers the advantage of no clearing charges. In addition, Zerodha provides cover request and section request (CO/BO) with trailing stop misfortune include for value and F&O best among the top 10 discount brokers in India.

Zerodha Charge/Fee Structure:

Protections Transaction Tax (STT): This is charged distinctly on the sell side for intraday and F&O exchanges. It’s charged on two sides for Delivery exchanges Equity.

Stamp Duty: Charged according to the condition of the customer’s correspondence address.

Merchandise and Enterprises Tax (GST): This is charged at 18% of the complete expense of brokerage in addition to exchange charges.

Different Charges (Zerodha Hidden Fees):

Call and Trade highlight is accessible at an additional expense of ₹50 per call.

 Source - https://medium.com/@deepakcomparebroker/zerodha-discount-broker-review-2020-compare-broker-online-2e0b057bef50

Related - https://comparebrokeronline.com/

[farsightgroup]

Farsight Shares: Mastering Share Trading with Foreign Entities

Farsight Shares offers a comprehensive platform for Share Trading of Foreign Entities. Our user-friendly interface makes it easy for investors to buy and sell shares of international companies with ease. Stay ahead of the market trends and diversify your portfolio by trading with Farsight Shares.

Click Here: https://www.farsightshares.com/

[dailygong1]

All You Need to Know About NRI Trading Accounts

Relocating abroad may be advantageous for some people. An NRI may earn a living in foreign currency while residing and working in some of the world’s most developed countries. Because of the large NRI community that exists around the world, a significant amount is invested in Indian stock.

NRIs must have a trading account to invest in Indian companies listed on the stock exchange. NRI trades are currently permitted exclusively in the F&O segment and for delivery settlement in shares, according to existing legislation. As a result, NRIs are unable to engage in intraday trading, STBT trading, BTST trading, or even short selling. Furthermore, NRIs are now (as per Jun 28, 2017, SEBI circular) permitted to trade in commodities or currency derivatives. This permission for NRIs to trade in derivatives is subject to norms as prescribed under FEMA and mandated by RBI, SEBI, NSE, BSE and other regulatory bodies from time to time.

Indian brokers’ trading services have been made enticing and trustworthy. Despite market instability, the country’s long-term prosperity is attracting many investors.

NRIs are also being courted by Indian stockbrokers with enticing choices such as the Zero AMC NRI Demat Account, the 2-in-1 NRI Trading Account, and the NRI Discount Brokerage Plans. An NRI 2-in-1 account, for example, combines a trading account with an NRI Demat account.

Need for NRI Trading Account in India

Unlike in the United States and many other nations, SEBI in India utilizes a Depository model rather than a Custodian approach. In the latter case, the broker acts directly as the custodian for the clients’ shares and is responsible for their safety. In India, the duty for the safeguarding of the shares is borne by a Depository (either CDSL or NSDL), which is nominated by the broker.

As a result, to trade and invest in shares on secondary markets, one must have an NRI trading account in addition to an NRI Demat account. The Depository maintains a Demat account in which securities are held in dematerialized form. In contrast, a trading account allows the account user to trade listed shares, ETFs, bonds, and other securities.

As a result, an NRI trading account is a form of investment account that allows Non-Resident Indians to trade and invest in mutual funds, ETFs, IPOs, bonds, and direct stocks that are listed on Indian stock exchanges.

This trading account serves as the central point or hub for all stock market transactions involving an NRI bank account, a Demat account, stock exchanges, and the NRI investor. It also allows you to trade stocks and futures and options (F&O) online [but we are strongly opposed to the speculative character of trading in general, and the F&O segment in particular].

NRIs must first open an NRE or NRO savings account with an Indian bank before applying for an NRI Demat account and an NRI trading account (or a 2-in-1 account).

NRI Bank Account

The funds for your trading account must come from a bank account created with an Indian commercial bank. You can open a new account or convert an existing one to an NRI bank account.

It is either an NRE [Non-Resident External or Repatriable] or an NRO [Non-Resident Ordinary or Non-Repatriable] account based on the repatriation of the monies in the account. Both accounts are denominated in INR and do not permit foreign currency transactions.

The difference is that with an NRE account, they can deposit their foreign earnings and withdraw them whenever they choose. In the case of an NRO account, they can deposit revenue earned in India but cannot withdraw funds straight to a foreign country without prior clearance from the RBI.

Why should NRIs have an NRI Demat Account and NRI Trading Accounts?

A Demat account is required to invest in Indian equities. This Demat account can also be used to invest in mutual funds, ETFs, and convertible debentures. One of the depositories maintains the securities in electronic form in the NRI Demat account.

NRIs, as well as PIO (Persons of Indian Origin) and OCI (Overseas Citizens of India) cardholders, are now able to create a Demat account with any SEBI-registered stockbroker. These Demat accounts are commonly referred to as NRI Demat accounts because they are linked to the appropriate NRE or NRO bank accounts.

When it comes to opening an account, transacting with them, and fees, NRI demat accounts are comparable to those held by Resident Indians (RIs). However, there are certain extra requirements for NRE accounts (repatriable) that we shall address momentarily.

A third type of trading account is the Portfolio Investment Scheme, or PIS account, which requires clearance from the RBI through the stockbroker’s banking channel partners.

For More Info: https://www.dailygong.in/services/nri-stock-trading

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Top 10 Online Stockbrokers In India

Gone are the days when the stock market investors and traders had to depend solely on the newspapers to keep track of their investment. Just like any other industry, technology has positively impacted the financial industry, especially the stock market and the way investors buy and sell the stocks. The emergence of technology has brought forward online stockbrokers.

What Is Meant By a Stockbroker?

A stockbroker is an approved intermediary vendor of the financial instruments that anyone buying or selling the shares of companies publicly listed on a stock exchange needs to go through to buy or sell Stocks and also the other exchange-traded instruments for instance bonds and funds.

What Is Meant By Best Online Stockbrokers in India?

An online stock broker is nothing but an automated digital version of traditional stockbrokers, that facilitate the buying and selling of stocks through the online trading platform provided by them.

The emergence of discount brokers has brought forward an inexpensive and convenient way for investors and traders to access the financial markets.

Furthermore, the online stock broker has brought down the cost of buying and selling stocks. Therefore the investors do not have to invest a big chunk of money all at once in the name of stock broker’s fees.

The online stock brokers provide investors with an online trading platform with a variety of functionalities and a wide range of value-added services, for instance, real-time stock exchange price tracking, research services and much more. There are several online stock brokers and each stockbroker has something different to offer to its customers ranging from research services to sell, education and buyback services. Thus, choosing the right online stock broker is very crucial to get the most out of your investments.

Top 10 Online Stockbrokers In India

We have enlisted the Best Online Stock Brokers in India. Just for you:

Zerodha

Upstox

SAS Online

5Paisa

ICICI Direct

Motilal Oswal

Kotak Securities

Sharekhan

Angel Broking

HDFC Securities

Now let us discuss all these online stock brokers in little detail below,

Zerodha

Zerodha, a discount broker founded in the year 2010 by Nithin Kamath is the first online stockbroking firm in India. Zerodha offers its customers, disruptive pricing models, with attractive brokerage charges. Its in-house technology has made it the best stock broker in India in terms of more than 9 lakh active retail clients and the largest stockbroker as far as the trading volume is concerned.

Zerodha is known for its innovative services flat rate brokerage and offers various trading platforms, which include Zerodha Kite Web, Zerodha Kite Mobile, Kite Connect Pi, and Zerodha Pi, Zerodha SMALLCASE, Zerodha Sentinel, etc. It has also launched a YouTube channel and learning application, Zerodha Varsity that educates its customers about the basics of the stock market. Additionally, it also has ‘Console’ – a back-office software. The best part is that all these trading terminals and software are offered to its customers free of cost.

Other than that, Zerodha, the first online stock broker in India facilitates Direct Mutual Fund investment through its online platform called ‘Coin’ that too free of charge. This online stock broker has also partnered with Thomson Reuters to provide research reports to investors.

Upstox

Upstox which was previously known as RKSV Securities was founded by Raghu Kumar, Ravi Kumar, and Shriniwas Vishwanath, in the year 2012.

Upstox offers its customers facility to trade in various segments, for instance, currency, commodities, futures, options, and equities through its online trading platforms namely Upstox Pro Mobile Upstox Pro Web.

Additionally, Upstox also offers its 2 lakh customers ’trade academy’ through which it organizes offline seminars to educate the investors.

SAS Online

SAS Online, a discount broking arm of South Asian Stock Limited was incorporated in the year 2013 and with time has emerged as one of the best online stockbrokers of India.

This stockbroking company was initially started as a team of 3 people and gradually grew in terms of clients and working professionals. They are based out of Delhi and do not have any branches thereby leveraging technology and saving costs on real estate, HR and other operational costs.This online stock broker has grown steadily acquiring new customers at a fast speed.

It is also a depository participant with NSDL. It facilitates its customers to trade in Equity cash, Intraday, futures and options, currency and commodities on NSE, BSE, and MCX.

5Paisa

5 Paisa a discount broking subsidiary of IIFL was founded in the year 2007 and is the second-largest discount broker in India that offers online investing and trading facilities to its customers.

The brokerage charges that are charged by 5 Paisa are very low that is only INR 10 per transaction. It facilitates customers to invest in a variety of financial assets like mutual funds and insurance. 5 Paisa offers its customers quite decent desktop and web-based platforms and also gives automated recommendations for mutual fund investments. Moreover, it has also collaborated with Marketsmith Online to offer it’s 1,22,500 customers high-quality research reports. This discount broker has separated from its parent company and is now functioning as a separate entity. It is the only discount broker, which is listed on the stock mark

ICICI Direct

ICICI Direct is the largest retail broking firm in India which offers a wide range of products and services to its almost 9 million retail and institutional customers.

ICICI Direct is the investment and trading firm of ICICI Securities whose MD CEO is Shilpa Kumar.

ICICI Direct.com is the flagship website of this online stockbroker company where customers can find a whole host of products and services like Derivatives Trading, Equity Trading, Mutual funds, Home Loans, Insurance Loans against Securities, NCD, Bonds, etc.

ICICI Direct also has an extensive offline presence with almost 200 branches spread across the country at 87 locations.

It facilitates the opening of a 3 in 1 account, which ensures a seamless transfer of funds. Furthermore, it also offers a high-performance trading application, ICICI Trade Racer.

Motilal Oswal

Motilal Oswal Securities knew as Motilal Oswal Financial Services Limited a full-time service broker, founded by Mr. Motilal Oswal, Mr. Raamdeo Aggrawal and Mr. Ajay Menon in the year 1987. Initially, it was focused on institutional securities but has now emphasized on retail stockbroking. Motilal Oswal Financial Services (MOFSL), is a well-diversified financial service provider company that is little towards the premium range as far as the charges are concerned.

Kotak Securities

Kotak Securities Limited (KS) is a subsidiary of Kotak Mahindra Bank Limited a renowned private-sector bank headquartered in Mumbai, Maharashtra and has a network of branches of almost 1300 branches in 350 cities.

Kotak Securities facilitates online trading services along with an extensive range of secondary market broking services, which includes cash equity, equity, and currency derivative, gold exchange trading fund, initial public offering, mutual fund, exchange trading fund, bond, stock lending and borrowing mechanism, and future.

Sharekhan

Sharekhan, the oldest stockbroking firm of India is a brainchild of Shripal Morakhia a Mumbai-based entrepreneur. It was founded in the year 2000 to leverage newly introduced electronic trading in stock exchanges and dematerialization/demat of securities.

It has been rebranded as Sharekhan by BNP Paribas after it was bought by BNP Paribas for INR 2200 crore. It is headquartered in Mumbai with 153 branches that are spread across 675 cities of India, and execute almost 4 lakh trades every day dealing with over 25,000 business partners.

Angel Broking

Angel broking is one of the oldest stock broking companies in India, which was founded in the year 1987 by Mr. Dinesh Thakkar. This full-service stockbroker is headquartered in Mumbai and has a presence in more than 1000 cities all across India with almost 1 million customers.

Over the period, this online stock broker has emerged as one of the best retail stock broking houses in India and is a member of BSE, NSE and also NCDEX and MCX the two leading commodity exchanges in the country. It is also registered as a depository with CDSL.

HDFC Securities

HDFC Securities, a full-service broking subsidiary of HDFC Bank that was launched in the year 2000.

This online stock broking company facilitates 3 in 1 account opening and along with that it also offers highly technological and efficient online trading platforms to i6, 52,900 customers, thus enabling seamless trading.

In addition to all this, it also offers the facility of NRI Account opening. Additionally, it also provides an NRI account opening facility.

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Stock Market Brokers in India - Providing Complete Assistance

Stocks and shares and shares investment is very popular amongst investors all across the globe. The countless benefits involved in it are hidden from no one. There is also an essential involvement of complicated paper work and require for intensive preparation from the investor's side. To assist investors undergo the whole process smoothly and conveniently, Stock brokers in Indian provide great assistance to them. Trading in stocks and shares is a trial; it requires immense knowledge and understanding of the market dynamics and trends. Share brokers facilitate an easy business in stocks and shares by assisting traders with comprehensive backing in the challenging field.

Through creating trading accounts towards the paper work involved in order to guiding the traders within their daily activities, a stock broker in India will be responsible for handling the whole account of an investor's trading processes in stocks and shares and shares. Hiring a reliable stock broker may relieve you from the particular worries of monitoring the particular detailed procedures involved in share trading. He takes treatment of the procedure independently. These people guide you in making the right and the the majority of beneficial investment, manage your money in the appropriate manner and also calculate your ROI. He is well versed with the share market trends and his relevant knowledge of the field can help you make the best of the trading opportunities you come across. A stock agent in India is a certified member of Nationwide Stock Exchange and the particular Bombay Stock exchange. This however, keeps him updated regarding market fluctuations and he so has a better idea of where plus when to take a position. A broker can intelligently buy or sell shares in the stock marketplace and if he is the smart one he then can bring you numerous benefits!! Considering the increasing involvement in share trading online, brokers are now actively involved in web-based share trading. You can contact him on the net through the trading website, take expert guidance plus reap the benefits a person get! From making Demat accounts to issuing NRI pan cards for Indians settled abroad, a stock broker takes care of all requirements. The share market is uncertain, right now there are highs and levels. Stock brokers in Indian assure the safest option for you. Be this online mutual fund investment decision or commercial trading within stocks, stock brokers may facilitate easy trade transaction with utmost convenience. They are qualified experts along with holistic knowledge and knowing of the changing market trends and dynamics. Trading in stocks and gives is a complex task. Plenty of paper work plus sunning here and right now there is involved in this. The investor is required to have immense period and energy in order to perform the whole process all by himself. To know more details visit here: share broker reviews

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COMPARISON OF TOP 5 SHARE BROKERS IN INDIA

Ever since the 3-in-1 Banking system arrived, every online stock broker in India has achieved a remarkable height of success. Well, this might be amazing for the brokers but to the investors, It has become equally challenging. We totally understand your urge to find the best online stock broker to start with your brokerage account and so, below we have listed down the top 5 share brokers in India to assist you with “the best brokers in India” query.

Name of the investees

Angel Booking

Brokerage Charges

EquityDelivery: 0.128% to 0.40%  Equity Future: 0.0128% to 0.04%  Equity Intraday: 0.0128% to 0.04%  Equity Options: Rs 32 per lot to  Rs 50 per lot  Currencyoptions: Rs 12 per lot to  Rs 15 per lot  Currency Futures:0.0096% to 0.03%

Broker Features

3 in 1 Account: No  Trading Platform: Angel Swift,  Angel Eye,   Speed Pro, Angel Lite  Margin Trading Funding: Yes  NRI Share Trading Account:Yes

Stock Broker Fees

Account Opening Charges: Rs 0  Brokerage Account AMC: Rs 0  Demat Account AMC: Rs 450  Minimum Brokerage:5 paisa per share

Transaction Charger

Equity Delivery: NSE Rs 325 per  core| BSE Rs 325 per core  Equity Future: Rs 190 per crore  Equity Intraday: NSE Rs 325 per  crore| BSE Rs 325 per crore   Equity Options: NSE Rs 5000(on  premium) per crore  Currency Options: Rs 5000(on  premium) per crore  Currency Futures: Rs 190 per crore  Commodity: MCX Rs 150 per  crore| NCDEX Rs 300 per crore

Name of the investeesSharekhan Brokerage ChargesEquity Delivery: 0.50% Equity Future: 0.10% Equity Intraday: 0.10% Equity Options: Rs 100 per lot Currency options: Rs 30 per lot Currency Futures :0.10% Broker Features3 in 1 Account: No Trading Platform:TradeTiger Stock Broker FeesAccount Opening Charges: Rs 750 (covered against first 6 months brokerage) Brokerage Account AMC: Rs 0 Demat Account AMC: Rs 400 Minimum Brokerage:Rs 16 per scrip Transaction ChargerEquity Delivery: NSE Rs 325| BSE Rs 275 Equity Future: NSE Rs 190|BSE Rs 50 Equity Intraday: NSE Rs 325|BSE Rs 275 Equity Options: NSE Rs 5000| BSE Rs 50 Currency Options: NSE Rs 4220|MCX Rs 3220 Currency Futures: NSE Rs 135|MCX Rs 130 Commodity:MCX (Non- Agri) Rs 230| MCX (Agri) Rs 95

Name of the investeesICICIDirect 3-in-1 Account Brokerage ChargesEquity Delivery: 0.55% Equity Future: 0.05% to 0.03% Equity Intraday: 0.275% Equity Options: Rs 95 to Rs 35 per lot Currency options: Rs 25 to Rs 10 per lot Currency Futures :0.050% to 0.030% Broker Features3 in 1 Account: Yes Trading Platform: Trade Racer Margin Trading Funding:No Stock Broker FeesAccount Opening Charges: Rs 975 Brokerage Account AMC: Rs 0 Demat Account AMC: Rs 600 Minimum Brokerage:Rs 35 per trade Transaction ChargerEquity Delivery: NSE 0.0031%|BSE 0.0028% Equity Future: 0.0018% Equity Intraday: NSE 0.0031%| BSE 0.0028% Equity Options: 0.05% on premium Currency Options: 0.05% on premium Currency Futures: 0.0012% Commodity:NA

Name of the investeesHDFC Brokerage ChargesEquity Future: 0.05% Equity Intraday: 0.10% Equity Options: Rs 100 Currency options: Rs 23 per contract Currency Futures:Rs 23 per contract Broker Features3 in 1 Account: Yes Trading Platform: Blink Margin Trading Funding: No NRI Share Trading Account:Yes Stock Broker FeesAccount Opening Charges: Rs 999 Brokerage Account AMC: Rs 0 Demat Account AMC: Rs 750 Minimum Brokerage:Rs 25

Name of the investeesAxisDirect Brokerage ChargesEquity Delivery: 0.50% Equity Future: 0.05% Equity Intraday: 0.05% Equity Options:Intraday Rs 0.01, Carry Forward Rs10 per lot Currency Futures :0.05% Broker Features3 in 1 Account: Yes Trading Platform: DirectTrade, Swift Trade NRI Share Trading Account:Yes Stock Broker FeesAccount Opening Charges: Rs 999 Brokerage Account AMC: Rs 0 Demat Account AMC: Rs 650 Minimum Brokerage:Rs 20 per trade or 2.5% of the trade value whichever is lower Transaction ChargerEquity Delivery: 0.00325% (Rs 325 per core) Equity Future: 0.0019% (Rs 190 per crore) Equity Intraday: 0.00325% (Rs 325 per crore) Equity Options: 0.05% (Rs 5000 per crore) Currency Options: 0.005% (Rs 5000per crore) Currency Futures:0.0019% (Rs 190 per crore)

[nextsteptosuccess]

How to Open NRI DEMAT Account, Tax on DEMAT

How to Open NRI DEMAT Account, Tax on DEMAT

If you are an NRI and you are interested in investing in Indian markets then this post will help you in opening an NRI DEMAT account, I have not only done the research but I have also opened an NRI DEMAT account and today I trade using these accounts.

In this post we will look at what NRI is,  the DEMAT process,  how to open an account, the cost of DEMAT with different brokers as an NRI and in…

[akankshasmishra]

What Are Shariah Compliant Mutual Funds?

Shariah Law is a law for Muslims mentioned in the Quran and the hadith. It restricts its followers from doing a specific kind of business. Investing in mutual funds might be a breach of certain rules.

To encourage this minority to invest in funds, multiple companies have come up with mutual funds that completely abide by the Shariah Law. So, here we will read all about the Shariah Compliant Mutual Funds that fulfill their interests.

India has 6 main religions with Muslim, Sikh, Jain, Christian, Buddhist, and Zoroastrians having minority status. Each minority has its own beliefs and rituals, which they follow. Even in investing, there might be some situations where putting money in a scheme might be a breach of a rule/law mentioned in any of the religious texts.

Which Shariah Compliant Mutual Funds Are Available In India?

S&P was among the first to launch Shariah Mutual funds in India with the following names

S&P CNX 500 Shariah

S&P CNX NIFTY Shariah

But currently, three schemes are offering Shariah Complaint Mutual Funds:

Tata Ethical Funds: – The scheme from TATA is best for investors looking for diversified investments. This is also great for people with less or no stocks and banking exposure. These funds give good returns in the long term. It is excellent for people wanting to invest in Equity and Equity related funds complying with Shariah law.

Taurus Ethical Funds: – Similar to TATA ethical funds, these funds also comply with shariah law and invest according to the rules mentioned. They give great returns in long terms and also bear the low risk.

Nippon India Shariah Bees: – Nippon India ETF generates money by investing in indexes similar to Nifty 50 Shariah Indexes. People seeking to invest for medium to long-range invest in these funds to obtain good profits. As these are ETF funds, for investing in it you need to have a Demat account. They are almost a carbon copy of S&P Nifty 50 Shariah; people having prior investments in it will be quite happy to invest in Nippon India Shariah Bees.

Which Of The ETF/Mutual Funds Is Right For Me?

Each of the mutual funds has its own set of features, making it usable for different kinds of people. Nippon India Shariah Bees is the ideal for choice for people who want to invest in Nifty 50 and wanting to get stable results for an extended period of beating inflation.

Nippon India Mutual funds require you to make a Demat account, and it is also low on liquidity because of the low trading values in ETF.

The other two Taurus and TATA ethical funds comply with the Shariah Law and give good returns. The investments are diversified with equity and equity-related funds with different market caps. You also don’t need to open a DEMAT account for investing in Shariah Mutual Funds.

Who Can Invest In Shariah Compliant Mutual Funds?

Shariah Compliant Mutual funds are compliant with shariah law. There are restrictions implied which are to be followed by every Muslim.

These are brought up mostly by the people following Shariah law or Muslims, but there are no restrictions as per the funds rule. Any Indian Citizen, NRI, or HUF’s are permitted to invest.

Minimum And Maximum Investment For Shariah Compliant Mutual Funds?

If you are trying to invest a lump-sum amount, then the minimum investment is 500Rs, and if you are trying to invest in SIP, then the minimum investment is 100Rs, which is invested monthly.

With respect to the maximum amount, there is no limit howsoever, on how much money you can invest.

What Is The Benchmark?

The benchmark used to compare Shariah mutual funds is S&P BSE 500 index. It compares the performances of the shariah funds with other funds.

They are specially designed to track the market performances of Shariah Mutual Funds.

Features Of Shariah Compliant Mutual Funds

According to Shariah Law Muslims cannot invest in all types of mutual funds; it has some restrictions for them to follow. Shariah-compliant mutual funds invest under Islamic boundaries.

1. Muslims are not allowed to invest anywhere involving harming people, either physical or emotional, or companies selling weapons, companies that harm the environment. Hence, Muslims are forbidden from investing in companies making a large amount of income using the sale of tobacco, drugs, alcohol, or weapons.

2. Muslims are also bound to avoid interest or Riba. Earing interest through any unfair means is considered as an engagement of war against god. So shariah funds avoid all the types interest, and the appointed Shariah Board distributes the interest to the poor and needy one’s

3. Mutual funds with a high level of risk are completely avoided, equity debt funds are also not included.

4. Shariah Mutual Funds also does not include investment in fixed -income streams.

5. Any individual is permitted to invest in Shariah mutual funds. It is a common misconception that only Muslims are allowed to invest.

Restrictions According To Shariah Law

For a mutual fund to be considered as a Shariah Compliant Mutual fund, certain restrictions have to be followed by the funds.

Debt to Asset Ratio: – It cannot be invested in funds where the total debt is one fourth or greater than its total assets.

Interest-Free Companies: – There are no companies that do not earn any income through interest; however, companies earning up to 3% interest are considered eligible to get invested.

Restricted Business: – The funds are not eligible to get shares of the company getting a major portion of their income through the sell of liquor, drugs, gambling, nightclubs activity, etc.

Tax Benefits On Shariah Compliant Mutual Funds

Shariah-compliant mutual funds currently do not enjoy any tax benefits and the interest earned is taxed normally according to the prevailing tax rates.

Interest earned within 1 year is considered as short-term gains and are taxed at an interest rate of 15%. For gains up to 1,00,00Rs, they are treated tax-free. In the case of long-term gains where the period of holding is greater than 1 year, the earnings are taxed at an interest rate of 10%

In the case of investments in gold funds, the earnings are considered as long term if the period of holding is greater than 3 years. If the time of holding is less than 3 years, then they are considered as short-term investments.

Shariah Compliant Mutual Funds Schemes In Detail

1. TATA Ethical Funds:

This scheme was launched in 1996. The TATA funds invest in a diversified company based on the shariah law. All the mentioned schemes have a benchmark of Nifty 50 Shariah TRI.

Scheme strives to provide medium to long- term capital gains by investing in equity and equity-related instruments following shariah laws of well-researched value and growth-oriented companies.

Types Of The Plan You Can Select

Regular Plan (For applications brought by the Distributors):

Growth

Dividend

Direct Plan (For applications not availed through Distributors):

Growth

Dividend

The minimum amount for transactions:

Regular Plan & Direct Plan:

Minimum Amount for Purchase: Dividend Option: Rs. 5,000/- and in multiples of Re. 1/- after that. Growth Option: Rs. 5,000/- and in multiples of Re. 1/- after that.

For additional investment Rs. 1,000/- and in multiples of Re. 1/-.

The repurchase or switches from one scheme to another request can be made for a minimum of- Rs. 500/ or minimum of 50 units.

2. Taurus Ethical Funds:

Taurus Ethical funds are also popular due to its hassle-free application and easy terms

Types Of Plan

They come with 2 plans

Regular Plan: This Plan is for investors who wish to do their investment via any distributor.

Direct Plan: It shall be available for such investment applications that are not routed through a distributor.

All the features of the Direct Plan under Scheme like the investment strategy, risk factors, facilities offered load structure, investment objective, asset allocation pattern, etc. will be all the same except for a lower expense ratio in the scheme.

Brokerage to distributors will not be charged under the Direct Plan

Minimum Amount For Application:

Purchase: 5000/- and in multiple of 1/- after that

Additional purchase: 1000/- and in multiple of 1/- after that

Redemption can be done for any amount or any number of units

Nomination Facility:

Investors should use for the nomination facility to avoid hassles or any problems in case of unprecedented events about to happen in the future. The nominee shall receive the Units only after the death of the owner

3. Nippon India ETF India Shariah BeES

Similar to the previous two schemes they also comply with the Shariah principles.

The aim of the Nippon India ETF Shariah BeES scheme is to provide returns that closely represent to the total returns of the Securities and companies as represented by the Nifty50 Shariah Index. They do so by investing in the same proportion as done in the index.

Minimum Investment:

Through Stock exchanges:– 1  unit and then in it’s multiple

With mutual funds:– In creation unit size viz 10,000units and it is multiple;

In accordance with its investment objective, Nippon India ETF Shariah BeES only invests in Securities or funds, which are represented in the Nifty50 Shariah Index.

However, Nippon India ETF Shariah BeES is not a Shariah-compliant scheme. In some regard, Nippon India has not appointed a Shariah board and currently does not follow any process for purification of the Shariah dividend.

What Is Shariah Law?

Shariah is the fundamental concept of Muslims, can be said as its law. It is looked upon as the god’s expression for Muslims i.e. how they should behave, and for that certain duties are to be followed by all the people believing the religion.

Ritual practices such as daily prayers, almsgiving, fasting, pilgrimage are the main constituents of Sharīah. They are ethical standards for Muslims on what one shall do and what one should refrain from doing.

What Does Investing Means as Per Shariah Law?

Shariah Law puts specific rules for Muslims on Investing:

High risk: – Muslims are not permitted to gamble or do any sort of gambling where high risk is involved, and if anyone does so, this act is considered as a sin. In short, Muslims are not permitted to enter business with high risk or gamble your money.

Restricted business: – Muslims are not allowed to carry or get involved in some specific business. These businesses include gambling, smoking, tobacco, and drugs. Even investing in companies manufacturing them is considered an immoral and sinful act.

Ban On Payment of Interest: – According to Shariah Law, taking a loan against interest is considered unlawful, and it is considered unfair and unjust to pay interest. Solutions for this can be a partnership or ownership of a business to get funds.

Frequently Asked Questions(FAQs)

1. What are the people who can invest in Shariah-compliant Mutual Funds?

Although Shariah Mutual Funds comply and abide by the rules mentioned in Shariah Law. There are no restrictions that laid on the person investing in the funds. Any Indian Citizen, NRI, or HUFs are eligible to invest.

2. Are Their any Tax benefits under the scheme?

No, currently there are no tax benefits to be availed under the scheme and are taxed similar to any other mutual funds scheme.

3. What is the minimum amount that has to be invested in the scheme?

The minimum amount ranger from company to company, but generally, this amount is Rs 500 for a lump-sum amount and Rs 100 in SIP investments.

4. Can a person from other religions invest in Shariah complied Mutual funds?

There are no restrictions on the caste, creed, or religion on the person investing in the funds. Any Indian citizen NRI or HUFs can invest in Shariah Mutual Funds.

5. What is Nippon India Shariah Bees?

Nippon India ETF generates money by investing in indexes similar to Nifty 50 Shariah Indexes. People seeking to invest for medium to long-range invest in these funds o obtain good profits. As these are ETF funds, for investing in it you need to have a Demat account.

6. What is Tata Ethical Funds?

TATA Ethical Funds is best for investors looking for diversified investments. This was also great for people with less or no stocks and banking exposure. These funds give good returns in a long term. It is great for people wanting to invest in Equity and Equity related funds complying with Shariah law.

7. Which is the best scheme among Tata Ethical Funds, Taurus Ethical Funds, and Nippon India Shariah Bees?

Limited schemes are abiding by the Shariah law and Nippon India Shariah Bees, Tata Ethical Funds, and Taurus Ethical Funds are among them. You should deeply look upon each of the schemes before deciding to invest in one of them.

8. What are the main restrictions for Muslims to invest in?

Muslims are not allowed to invest anywhere involving harming people, either physical or emotional, or companies selling weapons, companies that harm the environment. Hence, Muslims are forbidden from investing in companies making a large amount of income using the sale of tobacco, drugs, alcohol, or weapons.

9. If the debt to asset ratio is greater than 25%, will the companies invest in it?

According to restrictions by Shariah Law, the companies cannot invest in companies that have a debt to asset ratio greater than 25%.

10. How are Shariah-compliant mutual funds taxed?

Interest earned within 1 year is considered as short-term gains and are taxed at an interest rate of 15%. In the case of long-term gains where the period of holding is greater than 1 year, the earnings are taxed at an interest rate of 10%. For gains up to 1,00,00Rs, they are treated tax-free.

Bottom Line

The total AUM(Assets under Management) for all the three companies are very less as compared to the total market value of mutual funds and the total number of investor is also very less. In the future, multiple companies need to step upbringing in multiple schemes attracting people to invest in it.

Shariah-compliant mutual funds abide by all the rules mentioned in the Shariah Law. They do not invest in companies dealing with prohibited products. Earning interest and speculation is also not done by the fund providers. They are very good mutual funds, giving a good option for investing for Muslims without violating any religious laws

source http://invested.in/shariah-compliant-mutual-funds/

source https://investedindia.wordpress.com/2020/09/29/what-are-shariah-compliant-mutual-funds/

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Ask us: On long-term investments — May 4, 2020

New Post has been published on https://apzweb.com/ask-us-on-long-term-investments-may-4-2020/

Ask us: On long-term investments — May 4, 2020

Long-term investment

Q. I am 31 years old and looking for some good investment options on a long-term basis for me and my husband. We can’t have a PPF account as we are NRIs right now. What is the best option for us?

Last week, I started investing in Bajaj Allianz Goal Assure on a monthly basis. Is this a good option?

A. We do not know about your time frame and goal and what plan under the Bajaj Allianz Goal Assure you have chosen. This is a ULIP. So, if your primary purpose is to build wealth, you have to make sure the fund is performing well. Ask your adviser/agent to send regular updates on the growth of your money. If you find the performance not up to the mark in five years compared with mutual funds, consider stopping SIPs then. Try not to invest in bundled insurance products unless you are sure you understand all the features and costs.

As for other investment options, your time frame is paramount in deciding the risk you can handle. Having invested in a ULIP, I am assuming that you are willing to take market risks. If you are an NRI outside U.S./Canada, you can consider some exposure to index funds or ETFs in India. There are funds on the bellwether indices such as the Nifty 50, Next 50 or Nifty 500. You can own a mix of these for the equity component of your portfolio. This should constitute a long-term portfolio for the next 5-10 years, with regular SIPs to average the cost.

For the debt component, for the next 1-1.5 years, the low interest rate notwithstanding, consider NRE deposits in large private or public banks. We may see smaller banks coming under pressure post COVID-19 and hence, you need to be careful with the choice of banks.

This is not a time to chase returns in deposits. Look for safety. Lock into shorter tenures (1-1.5 years and not more). If you have a demat account, you can also check with your broker if they offer government securities (called gilts) and you can invest in those for the long term.

Any top-rated PSU bonds (nothing other than PSU) maturing in 3-4 years, traded in the market, will also be the options if your broker will help you with the same.

If you are based out of the U.S./Canada, your investment options are quite restricted here. It would be better for you to seek the advice of a fee-based investment adviser who is also familiar with the U.S. security and tax laws.

Retiring from the Army

Q. I am retiring from the Indian armed forces at 35. I will get pension and some lump sum in the form of PF, gratuity and other dues. Where and how should I invest my money?

A. We are assuming that you will take up some employment and have some regular income or that your pension will be sufficient for regular expenses. In that case, you can invest this sum for the long term for any goal you may have, including retirement from your next career, a couple of decades later.

If you are very conservative and only safety matters, then consider large pubic or private bank deposits, post office time deposits and deposits with large NBFCs like HDFC or Sundaram Finance. Lock into these for only 1-1.5 years as rates are low now. You can renew them when rates go up a year or two later.

If you can take some risks, then our suggestion would be that you park 20-30% of your corpus in equity index funds such as Nifty 50 or Nifty 500 for a minimum of 7-10 years. You can also park 5-10% of this in Indian funds that invest in U.S. indices such as the S&P 500 or Nasdaq 100.

This will help provide exposure to the U.S. markets, too, by just investing in rupees.

Use a systematic investment plan to invest in these over the next 1-1.5 years and don’t let the market ups and downs worry you. Make sure 70% of your money is in safe in deposits. You can also consider the RBI Taxable Bond available with all major banks. Do not be lured by any high interest rates in deposits. Over the next 1-2 years, high interest will carry far higher risks.

(The author is co-founder, Primeinvestor.in)

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Best Broker For NRI Investments In India

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Best Broker For NRI Investments In India

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6 Ways to Reduce Stock Market Risks

Investors are always worried about risks facing their portfolios. Many investors lose money due to these risks. Though there is nothing like a risk-free investment but there are definitely some smart ways to reduce the risk and earn money in stock market.

In our previous blog on ‘Major Types of Investment Risks for Stock Investors’, we learnt about the different types of investment risks that surround an investor. In this blog, let us understand the ways to reduce or manage stock market risks. These risk reduction strategies will help you protect your portfolio.

How to Reduce Risk When Investing In Stock Market

Diversification of Portfolio

Diversification of shares in your portfolio reduces the risk by spreading it across to a variety of shares. You can diversify your portfolio by keeping shares of different industry sectors or different company sizes, etc.

It is a good risk reduction strategy to invest in varying industry sectors like pharmaceutical sector, real estate sector, FMCG sector, banking sector, etc. So if one industry sector in your portfolio is not doing well, companies in other industry sector may be doing well. Like for example – If banking sector is facing a downside, it may be possible that real estate sector is booming.

Similarly, you should invest in companies of different sizes. Reason being, small and relatively new companies have ahigher potential for growth but at the same time are risky. On the contrary, large companies are more stable and have good performance record making them less risky. So it is advisable to have a mix of different company sizes.

Stay Invested for Long Term

 Be a long term investor, instead of being a short-term speculator. Buying stock and holding it only for a few hours or weeks is not investing, it is gambling. Moreover, the stock market is subject to short term fluctuations. Short term trading is risky and there are chances that you may experience a major fall in the price of your holdings during short-term.

On the contrary, long term investments are safe and yield better returns. The longer your investment horizon, the more likely the stock market is to rise. A long term investor is not affected by short term fluctuations and bear market.

Seek Advice

You are inviting risk by investing in the stock market without having knowledge of the same. If you invest without knowledge, you are gambling and it can result in losses. Investing in the stock market requires agood understanding of how the market works, what triggers the prices of stocks and how an investment strategy works. If you lack the knowledge, you must seek advice from qualified advisors who can guide you on investment strategy keeping in mind your risk tolerance.

Analyse Company’s Background and Performance

It is extremely important to research about the company you are going to invest in. You must look at the companies past performance, investment history, debt load, earnings growth, management competency and lot many other factors. Also, analyse the Price Earnings ratio (P/E ratio) of the company to measure the market value of a stock relative to its earnings. Pick stocks with lower P/E ratio as they are less risky.

Determine Your Risk Tolerance

Every investment carries some level of risk. Though it is impossible to eliminate the risk completely, but you can definitely reduce the risk. Determine your risk tolerance by analysing two factors - your net worth and risk capital. Net worth is your assets minus your liabilities. Risk capital is the amount of loss you can bear on an investment without impacting your lifestyle. If your net worth is high and risk capital is substantial, you can have a higher risk tolerance. Similarly, with lower net worth and risk capital, you should adopt a conservative approach and go for lower risk tolerance.

Monitor Your Investments Regularly

Be watchful of your investments. Monitor and consider reallocating your investments regularly. Allocation of investments depends on factors like your age, investment horizon, risk appetite, investment goals, etc. Asset allocation not only helps in maintaining the balance in your portfolio but also helps to achieve your goals. Let’s say if you have decided to invest 50% of your capital in large cap stocks, 25% in small cap stocks and 25% in short term bonds. Then once a year you should evaluate your holdings and rebalance your portfolio to bring back the decided asset allocation.

These are few effective ways to reduce stock market risks. Once you learn the tricks to avoid risks, your chances of losing money in stock market drastically reduce. So before you think of returns, figure out the risk and determine your risk tolerance.

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Online NRI Demat account is used to invest and trade in equities listed in NSE and BSE  stock exchange. With NRI Demant account, invest online in mutual funds and IPOs into favourable investments.