In share market, Demat account stands as Dematerialization. There is a great history behind dematerialisation of share market.
Dematerialization is the process by which physical share certificates held by an investor are converted into an equivalent number of securities in electronic form and credited into the investor’s Demat account.
In 1996 dematerialisation of share market happened.
Benefits of Dematerialization:
What is Demat Account?
Demat account is an account which maintains your shares like a Bank account which maintains your money. In simple words, it is the account that holds all your shares in electronic or dematerialized form.
You can not trade in share market without the Demat account.
How Demat Account Works?
Central Depository: Central Depository all Demat accounts and the details of shareholding of one's account. There are two depositories in India- CDSL and NDSL.
Depository Participants(DP): DP is described as an agent of depository They are intermediary b/w depository and the investors. DP can offer depository-related services only after obtaining a certificate of registration from SEBI.
In depository, trading is done among shares, debentures, mutual funds, derivatives, F&O and commodities.
More Read- All about Initial Public Offering(IPO), Start Investing
How to Open a Demat Account?
To open a Demat account you have to look for a DP and fill up an form for opening the Demat account.
There are many choices available in India which you can choose as your DP.
Dematerialization is the process by which physical share certificates held by an investor are converted into an equivalent number of securities in electronic form and credited into the investor’s Demat account.
In 1996 dematerialisation of share market happened.
Benefits of Dematerialization:
What is Demat Account?
Demat account is an account which maintains your shares like a Bank account which maintains your money. In simple words, it is the account that holds all your shares in electronic or dematerialized form.
You can not trade in share market without the Demat account.
How Demat Account Works?
Depository Participants(DP): DP is described as an agent of depository They are intermediary b/w depository and the investors. DP can offer depository-related services only after obtaining a certificate of registration from SEBI.
In depository, trading is done among shares, debentures, mutual funds, derivatives, F&O and commodities.
More Read- All about Initial Public Offering(IPO), Start Investing
How to Open a Demat Account?
To open a Demat account you have to look for a DP and fill up an form for opening the Demat account.
There are many choices available in India which you can choose as your DP.
