Meaning Of Demat Account Along With Uses, Expenses And Opening Process

In this article, you will come to know that what is Demat account, how can you open a Demat account, what are the uses of a Demat account and the expenses of a Demat account.

Demat account

What is Demat account?

Demat is the short form of 'Dematerialization'. Demat account is the account by which you can make sale-purchase in share market. Through Demat account, investors can keep their shares and securities in an electronic format. In other words, the process to convert securities from physical format in electronic format is called dematerialization.

How to open Demat account and how to use it?

To read about the process to open a Demat account and its uses, please

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Expense of a Demat account

The cost of opening a Demat account is about Rs. 300-700. Also you have to pay annual maintenance charges. This charge varies on Demat account of different companies. Also, there will be brokerage charges for buying and selling of shares. Generally, the brokerage will be more for selling a share than for buying it. The brokerage charge varies from broker to broker.

Can a person keep more than one Demat account

You can keep more than one Demat account. But you can open a maximum of three Demat accounts in a single company. In some cases, it is necessary to keep more than one Demat account. Fr example: if you have some securities on your name and some securities are in joint with any other member of the family, then you need two Demat accounts.

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Author: Pravat Kumar Das07 Sep 2014 Member Level: Gold   Points : 3

Now days Demat account is being provided by banks and broking houses.
As per my experience opening a demat account is little expensive at banks, so to avoid higher expenses you should open your demat account ( if you are a regular trader). with your broker.
Some broker even does not charge a single paisa for providing you demat services, as they are making profit from your broking transaction.

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