What is need and importance of Demat Account in India?
- Asked By
- Updated On:28-Jan-2021
- Replies:3
Short Answer
The stock market has seen significant changes since the introduction of demat accounts. Demat refers to “Dematerialization” of shares. Know the meaning, need and importance of Demat Account in India. Simply speaking, Demat account allows you to store securities in electronic form.
Detailed Answer
You might have heard of Demat account in India. When we talk of stock investing or stock trading, we often listen about "Demat account". So, I thought to express some useful info on the need and importance of demat account in India.
Gone are the days, when people used to store physical share certificates. So much hassle to secure these important pieces of paper and avoid them getting stolen or lost. This is when demat account comes to our rescue. No worries to carry this exhausting task of storing paper shares when you have the facility to store them in electronic form. Did you get my point?
So, Demat account allows you to store your shares in electronic form rather than holding them in physical form. Demat simply refers to "Dematerialization" of shares. Just as you have a bank account and carry online transactions. Similarly, Demat account helps you to keep your investments safely.
Need and Importance of Demat account in India:
- Acts as a safe repository for your different investments.
- Ensures security of your transactions.
- Paperless process of investing and trading.
- Demat account is a pre-requisite for trading in stocks.
- Invest and store a variety of investments like stocks, mutual funds, ETFs etc. at one place.
- A quick and convenient way to carry on your trading activities.
- Reduced cost of operations due to less paperwork to be done.
- User-friendly interface on various online trading portals make it a pleasant experience for investors.
- A simple and faster Demat account opening process is to be followed. You can easily get started!
To enjoy a seamless access to different services on your trading and investing path, you need to have a Demat account.
What do you think? Are you interested in long term investing or day trading? Do you have a Demat account? What are your opinions on the same? Any points to share.
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Discussion (2)
The importance of demat account can't be ignored in this digital era. We have entered the digital age where everything is getting online. Just few clicks & you can do different transactions. So, investing & trading in stocks is no exception. Opening a Demat account simplifies the entire investment process. These days 3-in-1 Demat-Trading-Bank accounts or 2-in-1 Demat-Trading Account options are easily available with different stock brokers in India. The Demat account opening process has also become simple involving less paperwork & documentation. It's high time we realise the importance of demat account in India.
No, a Demat account is not required to invest in mutual funds in India. Instead, there are a number of other options, such as Asset Management Companies (AMCs) or offline distributors through which you can directly invest in mutual funds without opening a demat account.
To open a Paytm Demat Account you do not need to make a lot of efforts. You can simply do it online which spares you from standing in a long waiting queue in the branch of the broker house. These days online and offline account opening has become all the more easy.
To buy and sell stocks in the Indian stock market, you will need a demat and trading account. A stockbroker is necessary to trade stocks because the broker will provide the trading account through which you will place your trades.
You need to download the account closure form available at Demat Account Closure Form and submit it at your nearest YSL branch. For the detailed process, read further.
You can download the account closure form the given link - Demat Account Closure Form and post it to the address mentioned in the form.
For closing the Sharekhan Demat account, the process is quite simple as with other stock brokers in India. Download the application closure form, fill up the details & submit it in the nearest branch.
You are required to fill up and submit a number of forms and documents via post to open a Zerodha account as an NRI. Continue reading and be informed.
The best stocks for college students to invest in in India are those with strong fundamentals and high dividend yields, such as Reliance Ltd., ITC Ltd., and Infosys Ltd.
Many Indian brokers allow you to open your Demat account for free, whereas some charge a nominal fee of Rs 200 to Rs 500. Although there are some recurring charges that you have to bear such as annual maintenance charges, Demat charges, etc.
Investors looking to invest in mutual funds without a Demat account can invest through financial institutions, independent financial advisors, AMC, and online portals.
Harshil Patel
It's a safe heaven for storing shares that you might have purchased. It's required for any person looking to trade in the stock market.