Buying and selling shares involve various things that need proper guidance. Investors who want to know how to trade stocks should consider understanding the market well which helps generate high profits and revenues. Moreover, they should open a Dematerialised account to hold shares and securities in electronic format. To open this account, one should contact a brokerage firm that is registered with SEBI. Nowadays, both public and private banks also allow people to open an account in easy steps that save time.
What is the meaning of the Demat account?
Those who are new to share trading may face several difficulties in managing their portfolio due to the lack of ideas. Therefore, they should open a Demat account to buy shares and hold them for weeks, months, or years. Investors can sell their shares at the right time after evaluating the market conditions. Furthermore, the account allows investors to know their transactions and they can draw the amount whenever they want. No one can access the details because it is digitally protected with passwords and investors can ensure peace of mind from unwanted risks.
What are the types of Demat accounts?
Stock brokerage firms and banks offer three types of Dematerialised accounts for traders when they want to generate more profits and revenues.
1. Regular Demat account
This account is mainly meant for any traders or investors who reside in India. It is the best option for individuals who want to trade themselves online. One can buy and store the stocks after opening this account. At the same time, investors cannot store the futures and options for a long term in a regular account because they come with an expiry date. It is wise to know the minimum deposit while opening this account.
2. Repatriable Demat account
Non-resident Indians are eligible to open this account when they want to buy or sell stocks and they can transfer funds abroad. However, they require a non-resident external bank account for this account. NRIs should know how to operate this account while moving to other countries. On the other hand, they should close their existing Dematerialised account in India before opening this account.
3. Non-repatriable Demat account
A non-repatriable Demat account is similar to a repatriable Demat account. However, NRIs cannot transfer funds abroad under this account and they have an NRO bank account to process the transactions.
What are the advantages of a Demat account?
The primary advantage of opening a Dematerialised account is that it provides opportunities to store multiple assets such as bonds, shares, mutual funds, government securities, etc. It even offers a nomination facility for investors to get benefits in case of demise. One can access the account online anytime and know things quickly. Anyone who wants to more learn about share trading can join a share trading course because it covers everything for investors. Also, it helps to understand the techniques used in buying and selling process with examples allowing investors to focus more on their goals and objectives.