Anyone with aspirations of making investments in businesses and trading stocks was helpless. Only the wealthiest members of the society were allowed to invest, and even if you were one of them, you still needed to be a broker or go to the trading floor in person to take part. Drastically things have changed, and the shift from the old and traditional pattern has changed to investment in companies via stocks and shares or by joining the global stock market. If you are interested in investing, you have come to the right place to learn the process. All you need is a Demat account which will secure your online traded stocks no matter where you are located.
What is a Demat account and why do you need it?
Demat account is primarily used for investing in shares and securities and it facilitates holding in a digital or electronic form. This account is required to trade shares in the stock market and it is also referred to as a Dematerialised account. All of a person’s investment in shares, exchange-traded funds, bonds, and mutual funds are properly tracked under Demat account. A Demat trading account is necessary to readily participate in the Indian stock market.
Demat account provides flexibility at lower costs and has lesser risks which leads to easy holdings of stocks and shares. It transfers the financial securities immediately with no stamp tax applied. Its digital format helps to avoid risks from theft, loss, manipulation, etc and eliminates TDS deduction. It facilitates convenient nomination and transmission in case of death of a holder. If you are interested in opening a Demat account, here is a step-by-step guide to help you out.
How to open a Demat account:
Step 1: Approach to a depository participant (An authorised bank- ICICI, AXIS, HDFC, SBI, UPSTOX, Choice, Angel Broking, Zerodha, financial institutions or broker)
Step 2: Fill and submit Demat account opening form (Includes- PAN Card, Residence proof, ID proof, Passport-size photographs)
Step 3: Fulfil the KYC (Know Your Clients) formalities
Step 4: Verify and sign the agreement copies (Rules and regulations and rights mentioned)
Step 5: Assign a nominee to your account
Step 6: Acquire your own unique Beneficiary Owner Identity (BOID) which is used to access the account.
