Over the years the stock exchange market has become electronic. Adopting the electronic system, the purchase and sale of shares today can be done via the computer and even through smart phones. In order to actively deal in the stock market, one requires to maintain a trading account as well as a demat account.
While a trading account helps in the purchase and sale of stocks in the market, a demat account is where one deposits the shares. When it comes to online trading account and demat account opening they go hand in hand. One generally opens both the accounts at the same time.
Here are the steps when it comes to online trading account and demat account opening-
• One has to first approach a depository participant (DP), generally a broker or even a bank. A DP functions as an agent who helps in the purchase and sale of shares.
• This is followed by acquiring and carefully filling-up forms in order to open the accounts. Submit the form along with relevant identity proof documents. Pan card, proof of identity such as a license or passport, proof of residence such as a ration card and a photograph that is self-attested are documents which are required.
• An agreement is then formulated between the investor and DP. This set of rules and regulations will be signed by you after which you will receive a copy of the same.
• After the agreement papers are signed and the submitted documentation is crosschecked and verified, one will receive their online demat account details, including the number. This number is called the BO ID (Beneficiary owner’s identification number). This ID will come in use in each and every future transactions.
• Once you get the online trading and demat account details, you can start buying and selling mutual funds, shares as well as debentures through the accounts. Bear in mind that unlike other accounts, no minimum securities need to be maintained in a demat account.
Legally, one can have multiple online trading accounts and demat accounts under one PAN card. They may hold multiple accounts with the same broker or even other brokers as well. In case of multiple accounts, annual fees for maintenance need to be cleared for each and every online trading account and demat account that one has. Apart from the annual account fees, one also needs to pay for the transactions fees as well as custodian fees. In case of one single account none of these charges apply, except the fees one covers at the time the account is opened.
While a trading account helps in the purchase and sale of stocks in the market, a demat account is where one deposits the shares. When it comes to online trading account and demat account opening they go hand in hand. One generally opens both the accounts at the same time.
Here are the steps when it comes to online trading account and demat account opening-
• One has to first approach a depository participant (DP), generally a broker or even a bank. A DP functions as an agent who helps in the purchase and sale of shares.
• This is followed by acquiring and carefully filling-up forms in order to open the accounts. Submit the form along with relevant identity proof documents. Pan card, proof of identity such as a license or passport, proof of residence such as a ration card and a photograph that is self-attested are documents which are required.
• An agreement is then formulated between the investor and DP. This set of rules and regulations will be signed by you after which you will receive a copy of the same.
• After the agreement papers are signed and the submitted documentation is crosschecked and verified, one will receive their online demat account details, including the number. This number is called the BO ID (Beneficiary owner’s identification number). This ID will come in use in each and every future transactions.
• Once you get the online trading and demat account details, you can start buying and selling mutual funds, shares as well as debentures through the accounts. Bear in mind that unlike other accounts, no minimum securities need to be maintained in a demat account.
Legally, one can have multiple online trading accounts and demat accounts under one PAN card. They may hold multiple accounts with the same broker or even other brokers as well. In case of multiple accounts, annual fees for maintenance need to be cleared for each and every online trading account and demat account that one has. Apart from the annual account fees, one also needs to pay for the transactions fees as well as custodian fees. In case of one single account none of these charges apply, except the fees one covers at the time the account is opened.
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