Discipline in stock trading is one of the most important factor in a successful trading. While most people believe that share trading is one of the easiest & fastest way to make money, but if not done in discipline then it may also become the fastest way to lose your money too. Before trading you as an investor must be informed & educated of all the important factors in share trading. Few pointers are:
• Always be prepared & have a structured trading plan • Stick to your trading plan • Avoid getting carried away • Be careful & avoid over trading • Don’t copy other strategies. What may have worked for them may not hold true for you • Always have a learning attitude A stock broker needs to follow a certain code of conduct while discharging his duties. This code of conduct is determined and prescribed by the stock exchange of which he is a part and more importantly by the Securities and Exchange Board of India (SEBI). In simple words, this code of conduct refers to the set of behavioural rules which a stock broker must abide to while performing his duties. The basic discipline for a stock broker is briefly summarised in the following points: 1. He must execute all orders regarding the purchase and sale of shares and securities with utmost honesty and sincerity. 2. He must purchase and sell shares and securities on behalf of his clients at the best possible market price. 3. He must make prompt payments to his clients in case of sale of shares and securities. 4. He must make prompt delivery to his clients in case of purchase of shares and securities. 5. He must never initiate any purchase or sale just for the sake of his brokerage or commission 6. He should never discriminate small investors against the bigger and wealthier ones. 7. He must issue a contract note for all transactions without any delay. 8. He must maintain complete secrecy of his client's personal information. 9. He must keep other information of his client confidential. 10. He should not provide any false or misleading information just for the sake of trade in order to earn his brokerage or commission. Thus, a stock broker should perform his duties with respect to the code of conduct prescribed above while maintaining high standards of integrity, honesty, promptness and fairness as well as taking reasonable care and due diligence in the discharge of his functions. Discipline must be followed in every walks of life to be regarded as a successful trader.
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