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Difference Between Dematerialisation and Rematerialisation | Motilal Oswal

There was a time when the Indian stock market followed the open outcry system, and the default trading method was through physical certificates. Conventionally, this resulted in a large amount of paperwork for traders and investors. It also contributed to the associated risks of dealing with physical copies.<br><br>However, with time, the Securities and Exchange Board of India (SEBI) introduced a new alternative to increase efficiency and transparency in the trading process. The resulting processes mandated the conversion of storing securities in digital format instead of using physical certificates

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Difference Between Dematerialisation and Rematerialisation | Motilal Oswal

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  1. Difference Between Dematerialisation and Rematerialisation Introduction Difference between Demat and trading account

  2. Introduction • A Trading account is used to buy and sell these assets on the stock market, whilst a Demat account is used to store your equities, together with share certificates and other documents, in electronic format. The primary difference between a Demat account and a Trading account is this. • Trading accounts and Demat accounts are closely related, although having distinct functions. To assess your actual stock market activity, your trading account, Demat account, and bank account all closely interact. The combination of a trading and a demat account is referred to as a "2-in-1 account" in stock market jargon.

  3. Difference between Demat and trading account • Following are the difference between demat and trading account • Difference between the nature of Demat & Trading accounts A Trading account records your capital market transactions throughout time, whereas a Demat account retains your holdings of shares and other securities at a single point in time. A Demat account accurately depicts the impact of your wealth at a single point in time, in contrast to a trading account, which is in the form of a flow of transactions over time. • Differences in the Function of a Trading Account vs a Demat Account A Demat account makes it feasible to preserve financial assets like equities and shares. Re-materialization, or the transformation of securities from their electronic form into their physical form, is another use for the Demat account. The usage of a trading account allows for the successful completion of this act of selling and buying stocks. A trading account will yield the same results if a trader solely wants to deal in currencies, options, or futures. Yet, the trader needs both trading and demat accounts if they want to trade equities. Demat accounts are essential for equities assets in particular since they securely hold securities.

  4. The Difference in the Charges of Demat account and Trading account: You can access as many trading accounts or depository accounts as you need with a single PAN card. With the same or various brokers, one may have numerous trading or Demat accounts. Investors who wish to maintain numerous Demat accounts must still pay annual maintenance fees for each account they keep, even if the accounts are not being used. The custodian fees, transaction costs, and AMC fees are all the responsibility of the account holder. The only costs would be those incurred when the account was opened if the investor only had one trading account.

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