📌 What is Stock Trading?
Stock trading is the buying and selling of shares in listed companies. When you buy a share, you're buying a part of that company. In Sri Lanka, all public shares are traded through the Colombo Stock Exchange (CSE).
🛣️ Why Start Stock Trading in Sri Lanka?
- ✅ Low entry barrier (start with Rs. 1,000)
- ✅ Regulated by the Securities and Exchange Commission (SEC)
- ✅ Dividends + Capital Gains
- ✅ Online/mobile trading
- ✅ Long-term wealth creation
🧭 Step-by-Step Guide to Start Stock Trading in Sri Lanka
1. ✅ Understand the Basics
Learn terms like Stock, Dividend, IPO, CSE, Broker. Visit www.cse.lk for beginner guides.
2. 🧑💼 Choose a Licensed Stockbroker
Popular brokers include Capital TRUST, First Capital, CT CLSA, Asia Securities, Bartleet Religare, NDB Securities. Full list: CSE Brokers
3. 📄 Open a CDS Account
You need a CDS account to trade. Required: NIC, utility bill, bank details, forms. Some brokers offer online account registration.
4. 💰 Fund Your Trading Account
Deposit funds into your trading account. Start with Rs. 1,000 or more via bank transfer or app.
5. 📱 Choose a Trading Platform or App
Use apps like CSE Mobile, Capital TRUST, First Capital Direct, Asia Securities.
6. 📈 Start Buying Shares
Research companies, check trends, and place buy orders via your app or broker. Begin with blue-chip stocks.
7. 🛑 Learn When to Sell
Sell for profit, to cut losses, or if performance drops. Monitor news and reports.
8. 💵 Understand Dividends and Profits
Earn through Capital Gains and Dividends. No capital gains tax; dividends may have WHT.
9. 🧾 Keep Records for Tax & Reporting
Track buy/sell activity, dividends, and statements for taxes or proof.
📚 Tips for Beginners
- 📌 Start small
- 📌 Diversify
- 📌 Be patient
- 📌 Avoid rumors
- 📌 Keep learning
⚖️ Legal and Regulatory Info
Regulated by SEC Sri Lanka. Brokers must be licensed by CSE. Insider trading is illegal.
🧮 Example: A Simple Trade
Buy 100 shares at Rs. 10 = Rs. 1,000
Sell at Rs. 13 = Rs. 1,300
Gain = Rs. 300 + Rs. 200 dividend = Rs. 500 total return
🧠 Final Thoughts
Stock trading is a smart investment strategy when done wisely. Start small, learn regularly, and track progress.
🔎 FAQ
- Can foreigners invest? Yes, via a CDS account with an authorized broker.
- Minimum investment? Rs. 1,000 depending on share price.
- Is it safe? Yes, if done through CSE and SEC licensed brokers.