Dematerialised account (popular as Demat Account)
An account that deals with the stock of shares and securities as per e-format are known as the Dematerialised account, popularly known as Demat Account. The opening of the same aims at converting the physical shares to e-shares (electronic shares). The account purposely is owned to make the stock trading easier facilitating the ease of the process. To open demat account means to kick-start the investor tour of the stock market. Just remember to start the journey as a stock trader you need to have an account in the bank.
The features of dematerialised account that favour your choice of opening the Demat account
A bank account and one trading account related to the same allows you to hold stocks and derivatives, commodities and metal etc. permitting you to enjoy your time of electronic stock trading. The Demat account owns four elements in particular: depository, depository participants, investors as well as a secret user ID.
Together with stock trade, these accounts have proved to be functioning as a means of transferring money/funds, conversion/dematerialization of charges, securities etc. into e-docs, utility as a security/collateral against any loan, access easy check on investments and availing benefits of electronic facilities. Even the procedure of opting to freeze a Demat account is as simple as that of a bank account.
Types of the same
The regular, repatriable and non-repatriable are the types of Demat accounts that offer different services and are made for specifically important purposes. The regular Demat account belongs to the Indian investors while the repatriable account belongs to the non-resident Indians who have a non-resident rupee account for the transfer of funds while the last one is for the NRIs with an NRO account.
Key reasons in favour of opening Demat account
- The convenience and ease of making the transactions prove to be time-saving for the traders.
- The minimal paperwork involved in registering the transactions is the basic key factor that attracts the traders.
- Absence of any risk like delay in processing, imitation of documents and brochure, thefts etc. due to electronic medium mix the same a favourite of all the traders.
- The Demat accounts provide you with a trustworthy platform that can hold you are equity instruments as well as the debt.
- The automatic editing policy to register the Demat account regarding the mergers, consolidations, bonus etc. makes it the integrated destination.
- The ease of changing the addresses as well as the personal information is the best feature.
- Elimination of numerous communication requirements makes it comfortable to operate and get information without any leakage.
- Purchase and sale (trade) of even a single share is possible with the opening of Demat accounts which was not the case with the physical stock market.
- Reduction of stamp duty charges associated as a part of physical or traditional stock trading.
Not only these but various facilities provided with such accounts from companies like Zerodha also forms the main reasons for opening the same. These accounts are normally found linked with the companies in terms of securities, increase of splits, issue of bonus or any other collaborations the automated centralised updates helps the investor to keep a check over the investments and the possibilities.