Shares and stocks are exciting to people nowadays, especially those in the investment game. And to be a part of this game, one must have a Demat account. The primary purpose of opening a Demat account is that it allows investors and shareholders to hold shares and securities electronically. It is pretty easy to open Demat account online and is also known as a dematerialized account. It helps keep a proper record of all the investments made in shares and exchange-traded funds, bonds and mutual funds in one account. It is digitally secured and provides an easy way to deal with shares and stocks without the hassle of any documentation as such. It gives the convenience of easy transfer, which saves a lot of time and streamlines the trading process.
Dematerialization is known for converting the physical certificates of shares into electronic ones, making it easy for the account holder to operate and maintain from anywhere. Nowadays, there is a lot of Trading App available online where people can open their accounts and make stock market investments without any hassle of physically visiting the stock market. There are different types of Demat accounts that one can open as per the requirement. Specific credentials like Bank Account details, Identity Proof, Address Proof, Income Proof, and PAN details are necessary for opening a Demat account. Opening a Demat Account makes it convenient for people to operate it at any time to review the stocks and further drive the investments per the market situation. The stock and share game requires a sharp mind to deal with unpredictability and easily make profits with minimum losses.
There are a few perks of opening a Demat Account, and some of them are listed below: –
- Cost Effective – opening a Demat Account is easy and cost-effective. The benefits of online transactions lead to cost reduction as they ease expenses like stamp duty and other handling charges necessary for physical bonds. The amount that is only payable in a Demat account is for brokerage.
- Time-Saving – the time to trade the shares, stocks, and bonds are relatively minimal, and shares’ liquidity is more accessible in this case. Earlier, transferring the physical shares was a lengthy process, but now the online transactions are processed instantly because the securities are stored in a dematerialized form.
- Global Investment – the account allows processing the Global Investments with a lot of ease. It also benefits the economy as foreign investors are given easy access to the Indian stock market through these accounts. Also, it opens doors for Indians with many scopes to invest in the foreign share market.
- Minimum Documentation – the only documentation required when opening the account, including various proofs related to identity, citizenship, bank history, income, etc. Other than these, hardly any documentation is required. In paper form, the shares can even get misplaced during any natural disaster that compels one to convert them into electronic format, which is more secure.
- Prevents Forgery – the paper form leads to more forgery, while electronically, it is impossible due to several security procedures the bank applies to the account. When you operate a paperless Demat account, you have all the necessary details and accurate data in your record, avoiding forgery or impersonation.
- Ease of Tracking – tracking the market fluctuation through the Demat account is pretty easy, and one needs to maintain hardcopy records. In Demate, documents are safely held along with the history of each investment.
Thus, opening a Demat account is easy and provides a lot of security, with the investments being safe and authentic. Therefore, making trading fun and secure.