This Blog is created to provide you with complete information about “How to Open a Demat Account” and which broker we should select according to our requirements to open account.
DEMAT ACCOUNT OPENING PROCESS
Before we deep dive into the process of open a Demat account, let’s know first some differences between trading/Demat account, which we had already discussed in our previous blog.
To save and transact money, you need a bank account, same way, To Transact/hold the shares, you need a Trading/Demat account.
Trading Account
If you want to trade in equities, exchange-traded mutual funds, bonds or other securities, you need to have a trading account.
It is your first step in the wonderland of investments.
Before online trading accounts, the stock exchange had an open outcry system where traders would bid for shares on the stock market floor or a trading ring.
Today, you can simply open a Demat account and place your orders without having to be physically present at a stock market.
A trading account is an account where traders/investors can buy and sell assets as frequently as they want, that too within the same trading session.
Demat Account
It’s an account that actually stores your shares in digital format.
A Demat account helps investors to hold their shares and securities in an electronic format. It is also called a dematerialized account.
It helps to keep proper track of all the investments an individual makes in shares, exchange-traded funds(ETF), bonds, and mutual funds in one place.
Dematerialization is the process of converting the physical share into electronic form, which is easier to maintain and it is easily accessible from anywhere.
The purpose of dematerialization is to eliminate the need for the investor to hold physical share certificates.
And to facilitate a seamless tracking and monitoring of their holdings.
The best broker we have suggested in our previous post ” how to choose a broker?“, please don’t forget to check out that.
Step by step process of how to open a Demat account?
Documents/other necessary details required for opening a Demat account :
1) Adhaar Card
2) Pan Card
3) 6-month Bank statement / Cancel Cheque
4) Photo/(sometimes live selfie through Webcam, depends on Broker)
5) Signature
6) Mother’s Name
7) Marital Status
8) Mobile Number
9) Email Id
10) Nominee Name
11) Nominee’s Adhaar Card/Pan Card
Because Government has introduced DigiLocker Facilities, you don’t have to fill all the details by yourself only for the broker who is integrated with Digilocker.
If you don’t know about DigiLocker, you can check out here to open a DigiLocker account.
Broker Recommendation
Out of 3 broker recommendations, Fyers & Upstox provides a free Demat account. You can Open your free Demat account with them by watching step by step process mentioned in the below video. Zerodha charges 200/- Rs for opening a Demat account but as they are charging the same they are providing better software and infrastructure services too. As we all know, better don’t come with free, and cheap is not always a good one. free Demat account opening offer for upstox is variable so check the current offer before opening an account but they are also good. But If you’re a beginner and want better software and order execution facilities for free, you can go with fyers.
So that’s it for now.
Don’t forget to check out our more “Financial market articles” to improve your learning & enhance your knowledge.
