What is a Demat and trading account?

“There are many who wishes the same but only those tastes the success who really work on it.” Therefore, only having a dream is not enough, a proper understanding and awareness are required to implement the plan of having additional money in your hands.

Well, there are many things that are required to be known before trying hands in the trading and investing world, but one thing that confuses the beginners most is the concepts of Demat and trading accounts. There are many who faces difficulties in understanding the difference between these two terms, Demat and trading account.

If you also want to have a crystal clear view of these terms, then read the full article.

 

What is a Demat Account?

Demat Account also known https://bitql.co/  as the dematerialised account is the one that provides facility of holding shares and securities in an electronic format. At the time of online trading, shares are bought as well as held in a Demat account, therefore stimulating easy trade for its users. A Demat Account holds all the investments that an individual makes in shares, bonds, government securities, exchange-traded funds, and mutual funds in one place only.

What is Dematerialisation?

The process of converting the physical share certificates into the electronic form, which is a lot easier to maintain and is accessible from anywhere throughout the world is known as Dematerialisation. An investor who wishes to trade online is required to open a Demat with a Depository Participant (DP).