For anyone to invest in the stock market, they need to have a trading account and demat account in place. In fact, a trading account and demand account have a few differences between them. However, having these two accounts is quite obligatory as it helps you trade in the stock market.
Before we dive deep into how these two accounts function and how can you utilize them for trading activities, let us first understand what demat and trading accounts are.
What is a trading account?
A trading account is required if you want to trade in the stock market. When a public organization is listed in the stock exchange, the company’s shares are made available for trading. With your trading account, you can either buy or sell these available shares.
What is a demat account?
A demat account will stores all the financial certificates – from your stock shares to bonds – in the electronic form. For instance, if you happen to buy 50 shares from an XYZ organization, then the digital copy of this purchase is stored in your demat account. Any transaction made (either buying or selling of the shares) is reflected in the account.
So, what is the difference between a trading and demat account?
The two most prominent difference between these two accounts are –
1. A trading account is used for buying and selling of the shares; whereas the demat account will only hold records of these transactions.
2. A trading account acts as a link between a bank account and demat account; while the demat account acts as a savings account and stores all your shares.
Procedure to Open a Trading Account
The steps to open a trading account are simple.
1. Choose a broker
2. Understand the different services they provide and the extra charges applicable (if any)
3. Fill a form for opening a trading account
4. Submit requested documents
5. After the verification, you will receive the account details
6. Once you get the account details, you can start trading
Procedure to Open a Demat Account
The procedure of opening a demat account is as follows:
1. For opening a demat account, you have to be a depository participant from the 6 SEBI registered depositories
2. Next, you have to choose a DP with whom you wish to open the account
3. Fill the application form
4. Submit the necessary documents
5. Once the document verification is done, you will receive your account number or the client ID
6. After this, you can access your account
Wondering how to open online demat account online? Well, the steps are pretty much the same, but you will have to sign the Power of Attorney (POA) in-person.
Managing your trading account is now simple with Indiabulls Ventures – ‘Shubh’ online share market trading application. This share market app is one of the ideal applications in India that will allow you to trade in the stock market efficiently.
Some of the salient features of ‘Shubh’ application are –
1. It offers 0%* brokerage on equity trading
2. Has a margin trading facility at 12%* interest p.a.
3. No annual maintenance charges for one year
4. Live-streaming data from NSE and BSE
5. Quick customer service
6. Multiple customizable watch lists
Apart from this, opening a trading and demat account with ‘Shubh’ mobile application from Indiabulls Ventures has various benefits.
• You can manage both these accounts conveniently from the ‘Shubh’ app
• It provides real-time updates and news regarding financial markets across the globe
• You are well-informed and updated with the latest events in the stock market
• Allows you to track your investment portfolio
The ‘Shubh’ application thus allows you effectively manage your trading account as well as demat account all in one place and on the go.