Why should you open a Demat Account? Know these 10 reasons and its benefits

A demat account protects your investments from fraud and reduces the risk of storage, theft, damage and malpractice. It also acts as a one-size-fits-all store for all your investments. This makes it secure and easy to use.

Moreover, it enables you to track and access all your investments in shares, government securities, exchange-traded funds, bonds and mutual funds from anywhere in the world under one account in electronic format. There are many advantages of having it. Let us understand it here.

10 Benefits of Demat Account

Protect your holdings

When you open your Demat account, your holdings are protected from loss due to wear and tear, misplacement or theft.

Keeps investments safe from fraud

Before online settlement, there were many cases of fraud or copying of owners using fake documents, but after the introduction of demat accounts in the market, it became impossible to fake or copy someone’s holdings.

Instant transfer of shares

Another advantage of a demat account is that not only does the transaction become secure or easy, but settlement is also instant. Quick settlement also reduces the risk of fraud.

Get instant access from anywhere:

It is easy to buy and sell shares from anywhere in the world using your laptop or mobile.

Unlimited shared storage

lets you not worry about the amount of shares you have stored. You can trade in small chunks and monitor your account online.

You can also get loans

Another advantage of having a demat account is that the securities held in your online account can be used to obtain loans from various banks. This can provide a lot of flexibility and convenience for those looking to obtain financing for different purposes.

You can update your account automatically.

If there is any change in the stock in your demat account, like bonus issue, stock split etc., you will get the update automatically in your demat account.

Nomination is available

According to SBI Securities, in case of unforeseen circumstances, your demat account ensures that your holdings are safe, and the appointed nominee will receive the shareholding.

Reduced Transaction Costs

The advantage of having a Demat account is that you can enjoy lower transaction costs, the charges are levied per ISIN, whether you transfer 1 share or 100 shares.

Eliminates Bad Delivery

In a depository environment, securities cannot be returned “under objection” for any reason whatsoever, and hence the question of bad delivery does not arise, nor is the investor faced with any uncertainty about the securities purchased by him.

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