Everyone is well aware the fact that they need a demat account to kick-start stock market trading. This account is provided by the registered stock brokers and financial institutions. These accounts have to be registered with either National Securities Depository Limited (NSDL) or Central Depository Services Limited (CDSL), the recognized depositories of the country. Since there are several stock trading brokers to provide the demat account with different plans and charges, it is better to make a study before selecting the service provider. This article will help you in winning the task.
It is real fact that even though everyone has heard about the demat account most of them are not aware of what it really means and the exact task of the same. Demat account is an account that works as just a storage place of your shares. The shares are not encouraged in physical form and they have to be stored in electronic form to engage in stock trades. Hence the account is intended to store the shares in electronic form and it is credited with the purchase and debited with the sales of the stock. You need another account apart from the Best Demat Account in India named trading account to handle the monetary transaction in purchase and sales of trades.
Free and paid account
Most of the brokers collect a charge to open the demat account from the customers. But there are some reputed brokers who are well aware of the intentions and expectations of the present investors and hence provide a free demat account to start with the trades. If you are a fresher to the stock market, then it is a good idea to get both demat and trading account on a single plan to enjoy the real benefits.
Documents needed to open the account
Demat account opening is just like opening a bank account and it needs passport size photos, a residence proof, and an identity proof. You can also open the demat account online with your Depository participant by submitting the KYC documents including address proof, recent passport size photos, and PAN card. Your depository participant can be a broker, banks or online investment platforms.
Charges for Demat account
The important charges related to opening a demat account include account opening charges, annual maintenance charges (AMC), custodian charges, and transaction charges. Account opening charge is the charge paid for the broker at the time of opening the demat account. But now you can save the amount by depending on the brokers who provide a free demat account. Annual maintenance charges are collected in advance by most of the brokers to keep the shares in the account. Custodian charges are paid to the brokers to hold the stock and securities. And the trading charges are charges or commission paid for the broker for the purchase and sales of shares and other commodities.
So it is a good idea to open the Best Demat Account in India for free of cost that charges the minimal cost in terms of AMA, custodian charge and transaction charges. At present, there are reputed online stock brokers platform who provide you with the list of best brokers in India to make an effective comparison and to select the best broker.