Benefits Of Demat Account

Having a demat account is not only hassle free, but also the most convenient & smart way to trading. If you somebody who enjoys trading with shares/ stocks, then having a demat account is a must without any extra thought. If you are a beginner, you may also choose a broker to open your demat account who will always charge you less but provide you best platform and support. Following are the benefits of having a Demat Account:

Demat Account | Image Resource : profitshow.in

LESS PAPER WORK – When compared to the physical form, the dematerialized form of shares and securities prove to be hassle free, simple and convenient just because they involve less paper work. On the other hand, physical shares and securities need a lot of paper work to be done, one has to fill in a lot of forms, complete a lot of formalities and sign a lot of documents. However, a Demat Account doesn’t require so much of a paper work. This advantage is quite beneficial during the transfer process.

CHANGING ADDRESS IS QUITE EASY – Earlier, if there was a change in address of the shareholder, he would have to notify each and every company, whose shares he is holding, about the change in address, this would be too complicated. But, with a Demat Account, one can change his address simply by recording it with a Depository Participant (DP), this would notify all the companies about the change in address, thus a Demat Account has simplified this problem. With the help of DP, transmission of shares can be done easily as the companies get notified through this.

A VARIETY OF INVESTMENTS IN A SINGLE ACCOUNT – One can invest in various forms of shares may it be equity or debt securities, even in other forms of shares and securities, all this can be done in a single Demat Account. One doesn’t have to maintain separate Demat Accounts for different types of investments. This is one of the most important advantages of a Demat Account. Thus, a Demat Account has made investment easy providing a lot of options for the investor.

PROFIT GETS AUTOMATICALLY CREDITED – In case of merger or consolidation or split of companies, the amount due to the shareholders get automatically credited to his Demat Account. This is the same in case of bonus or right shares as well. This feature of automatic credit is quite helpful for the shareholders and this is only possible in the case of a Demat Account.

Information on the Brokerage Firms in India offering Online Trading

Brokerage Firms in India | Image Resource: freepik.com

There are many brokers offering online trading. You need a demat and a trading account to trade online. The brokers offering depository services have the authority to open the demat accounts for the clients.

There are many brokerage firms in India offering depository services. They offer the following:

• They offer a trading platform to trade online utilizing the best available technology. They offer fast transactions and the transaction cost is low. Now there are web, mobile and desktop based trading platforms.
• They offer active support through phone, email and chat. The support team is ready to answer the client’s questions anytime.
• They have enough experience in trading. They offer the right service.
• They offer different trading plans to meet the different trading needs. You can choose the plan that suits your financial needs.
• They use the best technology to offer the best user experience.
• The brokers do not trade on your behalf without your consent. There is zero forced selling.
• They offer the highest intraday exposure to help you take the right decisions.
• There are no upfront charges or turnover commitment.

Trading app advanced features
Some of the brokers offer trading mobile app to help you trade online. The apps have advanced features to help you trade. It is the most amazing platform for the new and the experienced traders. The advanced features are:

Scanners
The scanners provide two lists of stock whose volume has been consistently increasing for the last three trading sessions. The increase in volume with the increase in price of a scrip may indicate the traders are bullish about the trade. A increase in volume with a decrease in price means there are many sellers who are increasing the volume.

The high and low breakers scanners provide a list of stocks that have breached a low or a high in particular time period.

The spreads scanner shows a list of stocks with highest change in spread between cash and nearest month futures contract. A long spread strategy means buy cash and sell future. A short spread means buy futures and sell cash.

Strategy
The strategies helps you to choose the right option strategy.

The bullish cover contract to execute cover call strategy where premium is high. This strategy should be used when you are neutral or slightly bullish.

The bearish cover Put strategy scans all the Put contracts to execute cover Put strategy where the premium is high. This strategy can be used when you are neutral and slightly bearish.

Demat Account vs Trading Account in the Online Stock Market

Demat Account vs Trading Account

To trade online in the stock market you need a demat and trading account. The demat account is used to store the shares and the trading account is used to do the transactions with the exchange. The demat account is opened in the depository and the trading account is held by the online broker.

When you want to buy shares form a trader the money is taken from your bank account to the trading account. The transaction is done by the broker using the trading account. The shares are stored in the demat account. When you want to sells shares the shares are transferred from your demat account to the counterparty’s demat account. The money is transferred to your account.

The transaction is done by the brokerage company. They credit or debit the shares to your demat account. You can cross check the ownership of your shares in the demat account at the depositories. You get direct access to the demat account. This should explain Demat account vs trading account.

Demat and trading account opening process
You can open a demat account or a demat and a trading account by approaching an online broker. To open the account you have to fill the form. You can request the form online form the broker and get it via email. Most of the brokers have the facility to print the form form the portal itself. You can get the form couriered to you by the broker for a fee.

The documents to be submitted along with the form are a self-attested copy of the PAN card, address proof, a passport sized photograph,a cancelled cheque and last six months bank statement. If you do not have last six months bank statement you can give a copy of the welcome letter offered by the bank.

The exchange requires the bank to do an in-person verification for which you have to be present. If all your forms are proper according to the KYC norms the account is made available to you within three days of receiving the form.

There is charge for opening the account and maintaining the account. Once you have the account you can trade online in equity, currency, futures and options and commodity.

Online broker
The online broker offers the trading platform to trade online. The online broker provide active support to the clients through phone, email and chat. The broker offers online trading tools to help you trade. The broker also offers different brokerage plans for different trading needs.