Which Type of Demat Account is Best for Trading?

If you want to try your hand in investing in share market, you will need best Demat account. Technically, Demat Account is used to hold shares, whereas Trading Account is used to place buy and sell orders.

A Demat and trading Account is needed to invest in a variety of financial products like Bonds, Mutual Funds, ETFs, stocks, and Government Securities. It is also essential while applying for Initial Public Offerings (IPOs).

A Demat Account can be seen as a Bank Account; while a Bank Account keeps your money, a Demat Account keeps your shares in electronic form. When you buy shares, the shares are credited to your Demat Account. Similarly, when you opt to sell your shares, they are debited from the same account.

Types of Demat Accounts

To select the Demat Account, it is crucial to know the it’s types. An investor may choose one basis their needs and priorities. Below is a detailed look:

    1. Single holding Account: This type of Account is held just by one person who will be the sole account holder. An individual who wants to invest his personal savings in share market can use this. Only the personal details of the individual opening account are needed. Here, the profits and risks will be solely borne by the single person.
    2. Joint Account: This type of account can be jointly opened by a maximum of three people. Here, the risks and profits will be shared jointly by all the account holders as per their agreement.
    3. Corporate Account: Any commercial set-up can open this type of Account. The account will be operated in the organisation’s name and all profits will be credited to the organization’s official banking account.
    4. NRI Account: For NRIs as well, Demat Accounts are available. There are two sub- categories:

    5. Repatriable account:If you open Repatriable account, you can transfer funds to your foreign bank account. The financial assets capable of being withdrawn from an account in a foreign country and being deposited to an account in an investor’s country of residence.
    6. Non-repatriable account: If you open non-Repatriable account it does not allow the holder to transfer funds back to the NRIs country nor they can be converted to any foreign currency.

Now let’s understand how to choose the Demat and trading Account

Below are few points to think about while selecting the Demat Account in India:

  • Charges: There are few charges levied while opening a Demat Account which includes – account opening fees, AMC charges, transaction fees, Dematerialisation&Rematerialisation charges, etc. These charges are critical to keep a track on. You should open an Account with the DP that charges a lower fees, and at the same time, have a good service record and provides transparency on the applicable charges.
  • Account opening procedure: Demat Account offers the advantage of speed and convenience. While opening Demat Account, the process of account opening itself will give an indication of technological advancement & service promptness of the broker. Accordingly, you can filter the Demat Account as per your experience.
  • Brokerage Charges: It is the amount charged by the broker in exchange of the service provided. These charges differ from one broker to the other. You can compare the charges with various brokers and choose the one with the most appropriate option that suits you.
  • Access to Back Office Reports: This Report gives you a consolidated account summary. It is the best means to track and validate your Account transactions. Therefore, do factor-in this condition and enquire about the availability of reports.
  • Quality of service: It is an important factor since you will be using broker’s platform to transact regularly, and queries will need to be addressed promptly. An established broker will have a countrywide network of branches or a dedicated online customer service team.

Opening Trading Account with Bajaj Financial Securities limited

Bajaj Financial Securities Limited is a discount broker that offers Trading Account with unique benefits. Check this out:

  • Affordable subscription packs
  • Within15 minutes account opening
  • Smooth trading platforms
  • Multiple products to invest in
  • Excellent customer support
  • One of the Lowest MTF Interest Rates

What are the charges associated with it?

Having a Demat and Trading account comes with specific fees and charges that are applicable when you use the services. Below are some charges that are applicable:

  • Account opening charge
  • Annual Maintenance Charge
  • Off Market Transfer
  • Pledge/ Unpledge charges
  • Dematerialisation&Rematerialisation Charges
  • Transaction charges
  • Clearing member charges
  • GST
  • STT
  • SEBI charges
  • Stamp Duty

Conclusion:

As in every other aspect, settling for mediocrity is not what you want, when it comes to Demat Account, you should not compromise & look for the best one.

You can take benefit of the booming capital market to start your journey towards wealth creation by investing in equities.

So, what are you waiting for? Open demat and trading account and start your journey to financially secure your future and your family.

Open Demat & Trading Account

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