What is a trading and demat account?

What is a trading and demat account?

Trading account is from where the order is placed for buying and selling of securities, whereas demat is an account where securities such as stocks, bonds, commodities are stored in electronic or digital format. Nowadays, you can easily open a free demat-cum-trading account with a securities broker (best stock broker in kolkata), in which case you won’t need to pay a single penny.

Trading and a Demat account are like your heart and blood, complementary to one another for the better functioning of the body in stock trading. It is critical to understand and be prepared for the fundamentals of stock markets. Opening a trading and Demat account is the first step in your trading career. In the stock market, a trading account is used to buy and sell shares. After you’ve opened a Demat Account, you’ll need to open a Trading Account, which will provide you with a specific trading number that you may use to trade stocks. You’ll need three accounts once you start trading stocks: Accounts with a bank, a depository, or a trading firm. A Trading Account connects your bank account with your Demat account, helping you to trade in the stock market. You can secure access to several stock exchanges by opening an online trading account. Dematerialization is the process of converting the hardcopy of your shares into a softcopy. Physically holding shares entails danger. However, shares held in a Demat Account can be readily stored. You can open a Demat account with IIFL free of cost and take advantage of its facilities. Holding a Demat Account, in other words, is the way of transforming or dematerializing your physical shares into an online world.