Secondary securities market is for trading of securities of a company already listed on stock exchanges. Thus If you want to invest in secondary market, you will need to chose a registered stock brokerage house or dealer to executed your trades. You may note that even if you deal with a sub broker, you will be transferring shares and receiving shares directly from the main broker. So is the case with your money and you will be making the pay-in and getting pay-out to and from your main broker.

A stock broker is an entity which is a registered member of a stock exchange and is also registered with SEBI. A stock broker acts as a facilitator or a bridge between stock exchanges and investors to carry out their transactions. He is in fact an interface between stock exchange and investors who want to buy or sell shares. Thus if you want to buy say 100 shares of say Reliance Industries Limited, listed on say National Stock Exchange, you would have to approach a stock broker registered in NSE to carry out your transactions.

Stock brokers are well regulated in Indian securities market. Stock brokers are governed and regulated under SEBI Act, 1992, Securities Contracts (Regulation) Act, 1956, Securities and Exchange Board of India [SEBI (Stock brokers and Sub brokers) Rules and Regulations, 1992], Rules, Regulations and Bye laws of stock exchange of which he is a member as well as various directives of SEBI and stock exchange issued from time to time. They are also subject to disciplinary action by SEBI and stock exchanges in case of default in complying with requirements.

Today the growing competition and a large number of options available to investors have drastically reduced the brokerage rates. You can chose a stock broker based on the amount of brokerage charged for your transactions, other services offered by him such as depository participant services, research etc. The background of the broker is an important parameter for selection. You may keep these factors into account before starting your trading through a particular stock broker.

Before start of trading with a stock broker, you are required to submit your details such as name, address, proof of address, proof of identity etc. Such documents may include copies of your passport, ration card, PAN, voter identity card. This process of verifying identity is called ‘Know Your Client’ or ‘Client Due Diligence’ and is a mandatory requirement. You also need to execute a broker client agreement specifying terms and conditions and other details. You are also entitled to a document called Risk Disclosure Document, which would give you an idea about the risks associated with trading in securities market. Go through all these documents carefully. As per the requirement of SEBI, all investors who want to trade in securities market need to have PAN allotted by the Income Tax department and submit a copy of PAN card to his broker.