What are the features of a Demat account?

Investing and trading in the stock market has gained a lot of popularity in our times. But, relying on the old methods for trading is not feasible anymore. Traders will need an online demat account to place their trades over the internet. This account is the primary requirement for buying and selling shares. Any first time trader can open their trading accounts through a depository participant for placing their trades.

With the advancements made in technology made every day, the concept of trading has become easy for the traders in a lot of ways. It is convenient and safe when it comes to investing in the stock market. A demat account or a Dematerialized account was introduced for easy handling and maintaining of shares and other holdings. But with the technology advancing with time, it kept on adding to ease of trading and holding investments. A lot of traders have the problem of How to check a demat account number when they lose it by accident, they can just visit the website of the financial institution and get the information about their trading account.

Some of the features of an online demat account are:

1.    Easy access:
An online demat account will be able to give the trader an easy and quick access to their investments and statements through net banking. These details can be accessible for a trader through smartphones, computers and other devices.

2.    Dematerialization of securities:
If an investor holds the certificates in physical form, the trader will need to give instructions to the depository participant for converting them in an electronic form. Certificates in the electronic form can be converted into the physical form if the trader needs it.

3.    Stock dividends and benefits:
Demat accounts have taken over the time-consuming process with easy methods for receiving dividends interest or refunds. All of it will be auto credited in the account. it becomes easy for a trader when it comes to updating an investor’s accounts with stock splits, bonus issues, public issues through electronic clearing service.

4.    Liquidity:
With the help of an online demat account, a trader can get money on selling shares conveniently without any problems.

5.    Freezing demat account:
An online demat account holder can freeze a specific type of quantity of securities. They can also choose to freeze the demat account for a certain period of time. it will pause the transfer of funds of any credit or debit cards in the particular demat account.

6.    Easy share transfers:
The transfer of shares on buying or selling has also become easy. Before the introduction of an online demat account, the transfer of physical transfers would take about 1 month time or so. Costs have also reduced with this simplification process. There is no stamp duty on the transfer of securities which are held in the electronic form.

7.    Loan against securities:
Traders with a demat account can also avail a loan against the securities which are held in their demat account.

Comments are closed