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What is the best Demat Account in India ?

Hello Readers !! Here we are going to discuss about how to find the best demat account in India.

Opening A Demat Account

Demat account, also known as Dematerialised Account, is generally used to hold shares and securities that you might have bought in an electronic format. Any person who wants to trade online in India should have a Demat Account. 

Just like a your savings account, your Demat account also comes with an account number, allocated by the stock broker, using which, you can both buy and sell shares and stocks. Just like you have a password for your online banking, Demat account also has a password, using which you can log into the system to make necessary stock purchases or to sell the existing ones. All the data pertaining to your purchases and sales is thoroughly encrypted and hence, highly secured. It is necessary to choose a best demat account in India which suits all your needs and become pocket friendly to you.

Demat account activities are governed by regulatory bodies such as NSDL and CDSL through intermediaries such as depository participants and stock brokers. Fee for opening a Demat account varies from stock broker to stock broker and from bank to bank.We have listed some best demat account in India at the end of this topic .

Advantages of a Demat Account

Why Need A Demat Account To Trade?

As per SEBI (Securities and Exchange Board of India), traders can no more buy securities in the form of certificates at exchanges. This directive has made it mandatory that any person who wants to trade in India should have a Demat account.

How does a Demat Account work?

Buying Process: Whenever you want buy some shares or securities offline, your bank or the broker with whom you have a Demat account can it for you on your behalf. All you need to do is place an order. Once the purchasing process is complete, your Demat account is credited with shares and you can now see them on your holdings statement. On the other hand, if you have purchased shares online, you can find them reflecting in your account online. In general, shares are credited into your account after three business days, i.e., trading day plus two days after that.

Selling Process: Similarly, when you want to sell your shares offline, all you need to do is leave an instruction also known as ‘delivery note,’ to your bank or the broker with whom you have a Demat account. In this note, you need to mention the details of the stock you want to sell. Once you are done with this, your Demat account is debited with the number shares you want to sell, and then is credited with the amount equivalent to the shares sold.

Who are Depository Participants (DPs) ?

The bank or the brokers with whom you hold your Demat account are known as depository participants. These participants are registered members with either or both depositories present in India, National Securities Depositories Limited (NSDL) and Central Depository Services Limited (CDSL). It is only through these depositories that shares are be held by depository participants. A list of DPs available in India can be found at NSDL or CDSL.

Here it should be noted that brokers can only act as depository participants and your account with them can only be used for buying or selling shares. On the other hand, if you open a Demat account with a bank, it will not only act as your depository participant, but it can also provide you with an account for saving your money as well as performing other financial transactions apart from just Demat and trading. 

How To Open A Best Demat Account in India?

The following information will help you understand how to open a Demat account, what are the documents required, how personal verification is done, and importance of nominee.

While filling in the application form, you will be asked to nominate a person, who, in case of your demise, will take charge of your shares and securities. You can change your nominee at any time by filling the form again, if need be.

It is suggested that you open your trading account in tandem with Demat account if you want to start buying and selling shares immediately. No further documents are required to open a trading account. You can open both Demat and trading account with your DP at the same time.

Best Demat Account in India

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Some Other Demat Account Providers in India.

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