Who is an Authorised Person in Stock trading?


An Authorised Person – a Link Between the Stockbroker and the Investor

If you are a regular investor in the capital market you must be acquainted with the significance of an authorised person. If you are not but wish to invest in the stock market then you should know the importance of getting introduced to the right authorised person. An authorised person signs an agreement and is appointed by the stockbroker to guide the investor with trading in the stock market.  He introduces the potential investor to the trading platform to buy or sell equities and provides the necessary knowledge and guidance. He matches your financial goals and investment needs with the market potential and suggests the best stocks to invest in. In short, an authorised person is a competent individual appointed by the stock broking firm to assist retail investors in stock trading.

What Does an Authorised Person Do?

The authorised person has multiple responsibilities to perform on a day-to-day basis.

For investor:

  • A seasoned authorised person helps you create an account in the stock trading platform and guides you to invest in specific stocks.
  • He gives you the necessary knowledge to understand the market trends and how the stocks perform.
  • He understands your financial goals and analyses your budget and risk-bearing capacity. Based on that he helps in creating a portfolio of high-performing stocks assuring high returns.
  • He’s the go-to person for any need you have related to trading and also protects you against potential losses.
  • He is also the point of contact for after-sales support and services.

For Stockbroker:

  • The stockbroker appoints an authorised person to assist their clients in trading.
  • The individual helps them get new clients and retain existing clients giving repeat business.
  • They are also responsible to expand the business volume by maximizing deals
  • An authorised person is also responsible to check and validate all kinds of documents submitted by the client, hence protecting credibility.
  • He also helps in maintaining clarity in transactions made by the investor.

How to Invest in the Stock Market?

If you are a first-time investor confused about how to start trading, the process is simple. Here is a step-by-step guide for beginners investing in the stock market.

  1. The first thing you need to do is to create a demat account that would enable you to trade in the stock market
  2. Once the demat account is open, you can contact any of the leading stockbroking firms
  3. Upon contact, the firm will assign an authorised person to help you sign up with the trading platform
  4. The individual will request some financial documents and identity proofs before you sign up
  5. Once your documents are validated and you are signed up with the platform, the authorised person will guide you through the process of trading
  6. He will help you in buying and selling stocks, also providing necessary information from time to time on the market trends and stocks that would maximise your return
  7. He will also make you aware of the market volatility and risks and help you make the best decision optimizing your benefits

Hence, an authorised person will make your investment journey in the capital market seamless and profitable. He will protect your money against losses on a bearish market and invest in the top-performing stocks on a bullish market helping you reap maximum benefits.

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