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Get more with a Demat Account now!
Mutual Fund | February 28

So, you are ready for share trading. What next? Your broker tells you to create a Demat account. If you think of this account to merely perform share trading, think again.

Once upon a time, you needed paper-made share certificates to trade in stocks. Not anymore, now you just need to open a Demat account for trading shares. It makes the entire process faster and paperless. It works seamlessly with a trading account given by a broker. The trading account helps to manage your trading activities. Also, the Demat account linked with net banking account makes fund transfer for trading easy.

Why the Demat account becomes necessary?         

As per Securities and Exchange Board of India (SEBI), you need a Demat account to buy or sell shares. In India, you can trade shares on National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). Use your account to store shares as per your investment plans, in the form of ETFs.

ETFs or Exchange-Traded Funds are financial instruments to hold assets such as shares, bonds, commodities and more in electronic format. Anytime, anywhere trading becomes possible for investors with ETFs.

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Here are some facts about Demat accounts

·         You do not need a stamp duty to transfer securities

·         It is safer compared to paper shares that could be stolen, duplicated, etc.

·         With automated processes, your account gets credited with funds after the transactions.

·        Achieve instant transfer of securities with a Demat account.

·         Depository participants take care of change of address and transfer of securities. Thus, saving time and reducing the effort on paperwork.

·         With the arrival of the Demat account, the transaction cost has also reduced.

·         You can hold equity as well as debt instruments in a single Demat account.

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How to open a Demat account?

You can open a Demat Account only with any brokerage firm. These firms should be registered as a Depository Participant (DP). DPs register with NSDL (National Securities Depository Limited) and CDSL (Central Depository Services Limited). Several Indian brokerage firms and financial services companies are registered as Depository Participants.

The account opening and maintenance charges for Demat account vary with brokerage firms. The initial paperwork for opening the account more or less remains the same. Some banks offer a Demat account clubbed with a user’s bank account and trading account. Meanwhile, stock brokerage companies provide benefits and expertise with attractive benefits for new users.

In short, it is ideal to understand what kind of an account works best for you. Then, invest in the potential of the stock market equipped with your Demat account now!

 

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ABOUT THE BLOGGERS
Dinesh ThakkarChairman & Managing Director

Dinesh Thakkar is the Founder & Chairman of Tradebulls Group, one of the fastest growing Indian stock broking house. Mr. Thakkar has over 20 years of rich experience in the Capital & Commodity Market.

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636202619765216833_Dinesh_Thakkar_front_Face_100_px_x_100_px.pngDinesh ThakkarChairman & Managing Director
636202618488664609_Aasif_Hirani_front_Face_100_px_x_100_px.pngAasif HiraniDirector Tradebulls
636202618640303853_Dhruv_Desai_front_Face_100_px_x_100_px.pngDhruv DesaiDirector Tradebulls
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"Prevent Unauthorized transactions in your Trading/Demat Account --> Update your mobile numbers/email IDs with your stock brokers/Depository Participant. Receive alerts/information of your transaction/all debit and other important transactions in your Trading/ Demat Account directly from Exchange/CDSL at the end of the day .......... Issued in the interest of investors." | "KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (broker, DP, Mutual Fund etc.), you need not undergo the same process again when you approach another intermediary." | "No need to issue cheques by investors while subscribing to IPO. Just write the bank account number and sign in the application form to authorize your bank to make payment in case of allotment. No worries for refund as the money remains in investor's account." |"Investment in Securities Market/Commodity Market is subject to Market Risk. | RGESS investors kindly download New Retail Investor Certificate from link - https://www.cdslindia.com/investors/rgessverification.aspx | Dear Investor kindly update Aadhar Number with your demat account, contact your nearest branch."
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