What is Demat Account?
You can open a demat account if you are a new investor in the stock market. To open an account, you must meet certain requirements. Most of the depository participants will ask you to fill in the personal details in a prescribed format. Most banks and brokers will pre-fill the Personal Details box with the PAN number and Date of Birth. However, you should still verify and attest the details. To open a demat account, you must have a valid bank account number. The bank statement should also have the IFSC and MICR printed on it. In some cases, you will need to share a voter id, a pan card or Aadhar. Several private banks allow you to access the demat account online.
There are several benefits of opening a demat account. First of all, it is safe and secure. The NSDL and CDSL regulates demat accounts. In addition, they send alerts whenever a security transaction occurs. The depository also takes measures to protect you from the risk of fraud, tampering, and loss of physical shares. Depository participants offer this service at no cost and are very popular with investors.
Once you open an account, you can receive a stream of beneficial information. A Demat account allows you to check live share market updates and analyze various investments. It keeps you updated with the market and will send you regular messages about dividends, results, mergers and acquisitions. You can also access analyst reports on different companies. In addition, you can track the performance of your portfolio over several investment products and make necessary modifications accordingly. This way, you’ll never lose a share!
In addition to a Demat account, you should also open a trading account. Trading accounts are essential for making investments in the stock market. When you buy shares, you must debit your trading account to pay for them. Once you sell them, the money in your trading account will be credited to your Demat account. Therefore, you should open a trading account as well. You don’t have to be an expert in trading or make a fortune trading stocks.
Dematerialisation is the process of converting physical share certificates into electronic form. It reduces the risk of loss and damage, as the shares are stored electronically. This makes handling shares much easier and faster. You’ll receive an acknowledgement slip if your shares have been dematerialised. The entire process only takes five minutes online. This end-to-end digital process has greatly contributed to Demat’s popularity. The benefits of dematerialisation are numerous, and the process is becoming easier with the advent of the Internet.
The most notable advantage of a Demat account is paperless receipts. Traders and investors do not have to maintain thousands of paper receipts for each and every transaction. Online Demat accounts make trading in stocks easier and more convenient. Additionally, they help you track your positions on a 24-hour basis with a dashboard. In addition, real-time execution has made intraday trading a profession. Keeping track of your positions is a breeze with this technology.
