There is an old adage that states that time is money. Not only is this extremely true but what is also true is that there is a time value of money. Therefore, the value of your savings now shall not be the same, say, five years down the line. This is one of the many reasons why you must select the most appropriate investment instruments for your savings and spare funds, and the stock market is certainly a great place to start your investment journey.
If you wish to start your investment journey in the Indian stock market, then you must start with the essentials. The first prerequisite for participating as an investor in the aforementioned market is the opening of a demat account. Alongwith a demat account, you are also required to have a trading account to engage in the purchase and sale of securities in the stock market.
A demat account is a safe place that holds all your stock market securities in a dematerialised form. For instance, when you purchase the stocks of any company through your trading account, the scrips get delivered to and stored in your demat account. You can open an online demat account and benefit from the digital storage of your securities.
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What are the advantages of having a demat account in India?
Not only is having a demat account a legal prerequisite of trading and investing in the Indian stock market, but it is also an excellent way to ensure the seamless delivery and safekeeping of your assets purchased in said market. You need not stress about preserving the physical share certificates and bonds since their digital counterparts perform the same function.
A demat account in India carries a wide gamut of benefits. Here are some of the benefits of opening a demat account for your investments in India.
- Your securities are kept safe: With a demat account, your stock market securities are held in a dematerialised state, which means that there are clear digital records of your ownership of said assets. Should you decide to sell those securities, you need not have their tangible copies. This saves you substantial time in terms of record keeping.
- Your transactions are well recorded: All the transactions that are carried out in your demat account are recorded in full detail so as to provide you complete and timely information as well as transparency. Everything from the date and amount of the transactions to the order IDs is easily accessible.
- Your trading and investment become seamless: With the availability of the latest information on stock prices and market trends in your demat account, it becomes easy for you to make informed and timely investment decisions.
- Your overall cost of holding securities is reduced: By opening a demat account and holding paperless records of your securities, you end up saving up on such legal expenses as Stamp Duty, which are payable for tangible share certificates.
You can easily open a demat account in India and have a transparent and hassle-free record of your trades and investments in the stock market. It is advisable to choose a trustworthy depository participant to open your demat account.