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Ventura Wealth Clients
3 min Read
Sovereign Wealth Funds

Some quarters of the investment community are affected by a crisis of confidence in stockbrokers.

Triggered by recent events, we have heard some stock investors express concerns that their funds and securities could be misused and frittered away by their brokers. Going a step further, there have been some who feel they should simply discontinue investing in stocks, to avoid untoward situations, with respect to their trades and funds.

Now, that’s a little extreme, wouldn’t you agree? It’s like throwing away the baby with the bathwater!

Equity still remains one of the best ways to create wealth, passively – i.e., without contributing either your time or efforts on an ongoing basis to building that wealth.

Further, trading in stocks has come a long way since the pre-electronic days in the 1990s and is now well-regulated and more professional, with transparent systems and processes.

buying and selling stocks

So instead of avoiding this product, why don’t we take a step back and look some of the measures we could adopt to ensure that we do not inadvertently put ourselves at risk. And, if something goes wrong, we have the might of SEBI, the exchanges, depositories and the law behind us.

1. Choose SEBI-registered brokers only - Always trust authorized brokers only with your hard-earned money. Dealing with registered intermediaries is safer and allows recourse to regulatory action.

2. When you sign up with a broker, always insist on a copy of the member-client agreement. Be aware of charges levied. Read the risk disclosure documents

3. Execute KYC and provide necessary supporting documents. Never leave anything blank on your KYC and keep a copy of the KYC and other documents

4. Get your Unique Client Code (UCC) and trade only from your UCC

5. Give clear instructions to your broker. Verify trades and check your accounts– funds and securities movement– from time to time

6. While buying and selling stocks, pay funds and securities for settlement on time. Also make sure that you receive your funds and securities on time.

7. Don't forget to obtain and maintain all documents of transactions

8. Make sure you receive contract notes for trades executed. Read these contract notes thoroughly before signing them.

9. Understand the rights you give to your broker through POA(Power of Attorney); the POA facility is for your convenience, it should not tie you down.

A little effort goes a long way, especially while investing in stocks, so do your bit to stay safe. Know your rights and responsibilities as an investor because, as Benjamin Franklin once said, "An investment in knowledge pays the best interest”.

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We, Ventura Securities Ltd, (SEBI Registration Number INH000001634) its Analysts & Associates with regard to blog article hereby solemnly declare & disclose that:

We do not have any financial interest of any nature in the company. We do not individually or collectively hold 1% or more of the securities of the company. We do not have any other material conflict of interest in the company. We do not act as a market maker in securities of the company. We do not have any directorships or other material relationships with the company. We do not have any personal interests in the securities of the company. We do not have any past significant relationships with the company such as Investment Banking or other advisory assignments or intermediary relationships. We are not responsible for the risk associated with the investment/disinvestment decision made on the basis of this blog article.

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