Introduction to Demat A/c
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  • 1. An Introduction to Demat Accounts
  • 2.  DEMAT refers to dematerialized a/c  DEMAT account is mandatory for trading and investing of shares  It is similar to a bank a/c where actual money is replaced by shares
  • 3.  Demat a/c can be opened with Depository Participant (DP) who will provide official procedure to open an account.  The DP is an intermediary between the Depository & the Investor  There are two depositories National Securities Depository Limited (NSDL) Central Depository Services Limited (CDSL)
  • 4.  As per the Securities & Exchange Board of India (SEBI) guidelines all trades have to be settled in dematerialized form only  Although SEBI has allowed trades of up to 500 shares to be settled in physical form  Hence, if you want to buy and sell shares through the stock exchange, you necessarily have to have a demat account.
  • 5.  It allows immediate transfer of securities  No stamp duty required  Purchase ,hold and sell shares in electronic form  Elimination of risks such as Bad delivery, loss of certificates, delay & theft
  • 6.  Shares can be credit / debited automatically  You can even buy / sell single a share  Auto Credit of Rights / Bonus / Public Issues / Dividend credit through ECS  Auto Credit of Public Issue refunds to the bank account
  • 7.  Need to fill demat request form  One or two Passport size photograph,  Proof of address like  Voter ID card  Electricity bill / Ration Card  Employee ID Card  Bank attestation  Latest IT Return  Passport in case of NRI  PAN Card as a proof of identity As of April 2006 it is mandatory,Without a PAN CARD you are not be eligible to open a Demat account  Finally in 7 working days DEMAT A/c gets opened for trading after detailed verification
  • 8.  Indian Citizen(individual / joint or by a minor)  Min 18 yrs or can have a joint a/c in case of a minor  HUF  All sorts of the proofs of the KARTA of that HUF  NRI  All sorts of information from foreign & host country
  • 9.  When you buy shares, the broker credits your demat account with the shares and these are reflected in your statement of holdings. if you are trading through an internet based platform, you can view your holdings online. Typically the broker credits the shares on T+2  When you sell the shares, you need to give your broker a delivery instruction note, where in you fill the various details of the stock sold. Your account is debited with the shares and you are then paid the money for the shares sold. If you are trading through the internet, the account will automatically reflect a debit of the shares and amount credit to your account.
  • 10.  Like there are two main Stock Exchanges, the NSE & BSE, there are also two set-ups handling Demat Account services called NSDL and CSDL  Depending on where a particular security is listed/traded, it is handled by the concerned set-up, both in case it is listed/traded on both exchanges.  NSDL is the largest depository of Indian stocks  Trades done is NSE are linked directly to NSDL  Trades done is BSE are linked directly to CDSL.
  • 11. A/c opening AMC Intraday brokerage Delivery Brokerage 120 450(1st yr free) Higher of 10 p per share or 0.10% of transaction value Higher of 50 p per share or 0.50% of transaction value •Sharekhan offers different trading platform to suite customer requirement.This includes online browser based trading, Installable terminal, mobile, call & trade and in-person trade though branch offices. •Sharekhan offers online and classroom training, seminars and workshops to investors. •Sharekhan has India-wide network of branches & low brokerage charges •You can surly find a Sharekhan in your neighborhood •Call &Trade facility is free with Sharekhan •People prefers this also due to their personal relations & word of mouth
  • 12. A/c opening AMC Intraday brokerage Delivery Brokerage 999 500 Higher of 5 p per share or .10% of transaction value Higher of 50 p per share or .50% of transaction value •Axis direct also offers trading platform to suite customer requirement. This includes online browser based trading, Installable terminal, mobile, call & trade and in-person trade though branch offices. •It being a subsidiary of Axis bank it provides 3 in 1 a/c which brokers can’t •Funds can be transferred from other bank a/c’s via net banking in case of shortage •Already has a huge customer base of CASA •Good Brand Image •Special Relationship managers assigned for Privileged / HNI clients
  • 13. Banks A/c opening AMC Intraday brokerage Delivery Brokerage HDFC securities 799 825 Higher of 25 rs or 0.10% of trans value Higher of 25 rs or 0.50% of trans value ICICI direct 975 500/450 0.0275 % of trans value 0.55% of trans value Broking Firms A/c opening AMC Intraday brokerage Delivery Brokerage Motilal Oswal Securities 500 450 0.03 % of trans value or 0.30% of trans value Angel Broking - 500/450 .0275 % of trans value .55% of trans value
  • 14.  Axis Bank  Bank of India  Geojit BNP Paribas Financial Services  HDFC Bank  IL&FS Securities Services  India Infoline  MotilalOswal Securities  Reliance Securities  Sharekhan
  • 15.  Axis Bank  Barclays Securities (India)  BNP Paribas  Citigroup Global Markets India  Geojit BNP Paribas Financial Services  HDFC Bank  HSBC  ICICI Bank  IL&FS Securities Services  India Infoline Interactive Brokers (India)  Kotak Securities  Sharekhan -
  • 16.  http://home.axisdirect.co.in/dynamicWEB/de mo/TradingUser/easy_2_1.html  http://www.sharekhan.com/tradetigernew/D emo/demopage.html