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Top 10 Reasons for Opening a Demat Account

by shreyadixit

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With traditional approaches, investors had to worry about the physical certificates and documents of their investments. The concept of demat account has brought very significant change in market practices. Demat account is a safe and convenient means of holding securities just like a bank account is for funds. By possessing physical certificates of your shares, bonds etc. there will be several of the risks such as theft and mutilation. Other than that, risks of bad-delivery, delays in transfer of physical securities or holding fake papers are also present. A Demat account can save your neck from all such types of troubles. You will stay assured about the safety for you long-term investments by holding your securities electronically.

With the help of demat account you will be able to keep track of your securities and investments, without the hassle of handling physical documents. Demat account holders usually obtain quicker receipts of benefits like stock splits and bonuses. It can be considered as centralized investment account from where you can access and maintain investment products. It offers exclusive access of stocks, bonds, ETFs, IPO, Gold ETF, etc. all in one place.

Not only this, you will be doing your investments and transactions with convenience. With the help of electronic transfers, you will be managing your investments without any hassle. Functioning of a Demat account resembles that of a bank account. Furthermore, all the buying and selling of shares are also adjusted in this account. Hence, you are free from the hassles of transfer forms, redemption requests and almost every other cumbersome paper work.

• Flexibility of parking almost all investments
• Automatic credit of redemption proceeds in your account
• Direct credit of all dividends and interests in your connected bank account
• Automatic occurrence of rights, bonus, merger, split, etc.
• Option of online trading and transfer of share
• Nomination of your legal heirs with just one nomination in your demat account
• No chance of mismatch in signatures due to the dematerialized trading of securities
• Reduces the brokerage charges
• There will be lesser requirements of paper work
• The investors don’t have to face forgery or delivery problems

You don’t need to have in-depth knowledge for this. All you need to know is to manage your electronic account and rest will be the piece of cake.

Demat account opening is mandatory if you want to invest in stock market. Know how to open demat account in India and what are the benefits of opening dmat account.

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