When investing in the stock market, having a Demat account is essential. It allows you to hold your shares in dematerialized form and trade them online seamlessly. Online share trading has grown significantly over the past few years, and Demat accounts have been a significant contributor to this growth. In this blog, we will guide you through the process of setting up your online Demat account for successful share trading.
What is a Demat Account and Why Do You Need It
A Demat account is an electronic account that holds your shares and securities in digital format. It eliminates the need for physical share certificates and offers a more convenient and hassle-free approach to stock market trading. With a Demat account, you can trade stocks, bonds, mutual funds, and other securities. Furthermore, it provides you with many benefits, including quick and easy transactions, secure digital shares storage, and easy accessibility.
Difference Between Demat and Trading Accounts
A lot of people may confuse a demat account with a trading account, but they are two completely different things. Trading accounts are used to buy and sell securities in the stock market. On the other hand, a Demat account serves as a digital depository, where you hold the shares you purchase through your trading account. In other words, while trading accounts facilitate stock market transactions, Demat accounts hold the shares you purchase.
How to Open an Online Demat Account
Deciding on the right brokerage platform is critical when opening an online Demat account. It is the first step in your journey toward successful share trading. You need to evaluate the platform’s features, security, user interface, and ease of use. Some popular brokerage platforms include Zerodha, Upstox, Angel Broking, and HDFC Securities. Make sure you research them thoroughly before selecting a broker that suits your needs.
Documents Required for Demat Account Opening
To open a Demat account online, you need some documents in hand. The list of documents required varies from one brokerage platform to another; however, some essential documents are mentioned below:
– PAN Card
– Address Proof
– Identity Proof
– Bank Details
Demat Account Opening Process
The process of opening an online Demat account is straightforward. Follow these simple steps:
– Choose a brokerage platform and create an account.
– Provide the necessary documents required.
– Once the documents are verified, you will receive a call for e-KYC verification.
– Complete the verification process by answering a few questions.
– Sign the account opening form and send it to the brokerage platform’s office.