Demat accounts came into being in India some decades before ahead of
which securities, as well as shares,were held
in physical form. Now you as an investor are
able to retain such securities in electronic form by means ofdemat account. It renders the whole
process of investing, monitoring, holding, easily and also trade rapid, easy
and very inexpensive. Not only that, the SEBI which is the stock market
regulator of India also has made the Demat account mandatory one for every
trader as well as an investor. Hence
before you start investing or trading in the stock market, you must get a demat
account opened from any valid stockbroker or even a stock broking house. The
process of opening a demat account is simple,and
one can get the same opened in a few days after submitting
the application to the concerned broker in the market.
Characteristic of a demat
account
Here are a few characteristics of this account.
Share transfer easy
Investors are able
to transfer the assets by way of the RIS—receipt instruction slip and
DIS—delivery instruction slip meant for selling and purchasing shares. These
slips permit investors to impart all information that is necessary for carrying
out trade easily.
Quick dematerialization and re-materialization
of securities
Operators of demat account are able to give directions to the DP –
depository participants to change certificates held in physical form to
electronic format. On the other hand, it
is possible to change electronic securities to physical form if the need arises.
Pledged to get a loan
A number of lenders offer loan in
lieu of the securities which are retained
within a demat account of the account holder. These assets are utilized in the shape of collateral to get
loans by the borrowers.
Demat
accounts can be free zed
Holders of free demat account are able to freeze the accounts for some span of time if it is
necessary. This option is able to be
advantageous if the investor desires to stop unwanted credit as well as debit
into his demat account. This option of freezing may be also availed by particular volume of securities retained within any account.
Numerous
accessing choices
As is evident the demat accounts are run by
electronic means by which is meant that these are accessible employing manifold
modes. These accounts are able to be
accessed by way of the internet utilizing
any smartphone, computer or some other similar devices.
Speed -
e - facility
NSDL- the national securities depository limited permits the investors to convey instruction slips in electronic form in place of making
physical submission of the slip towards the DP. It renders the entire process
simple and also less time taking.
Corporate
advantages and actions
In case any company provides refunds, dividends, or
interests to the investors, all such rewards get electronically available to
the holders of the demat account. Besides, several corporate actions such as
right shares, bonus issues, or stock split get electronically updated within
this kind of the account held by the shareholders.
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