You need a demat account to start buying and selling stocks in India. But with so many brokers offering demat account services, how will you select the best? With the help of 5 valuable tips mentioned in this post!
Dematerialized account or demat account is a digital or paperless form of trading stocks in India. If you’d like to buy and sell stocks, it is compulsory to have a demat account. It is in this account that the stocks that you purchase are stored in a digital format. Similarly, when you want to sell stocks, it is from your demat account that the stocks are withdrawn.
Every broker in India offers demat account services. If you are new to the stock market, selecting the best can sometimes be confusing. If you are struggling to choose a demat account, these tips can help you decide-
- Brokerage Charges
One of the most important considerations when selecting a broker is the brokerage charges. Stockbrokers in India charge either a fixed brokerage or percentage of transaction amount when you buy or sell the shares. The charges often vary between different trading instruments like equity, derivates, currency, and commodities.
- Account Opening Fee
There is also a fee for opening a demat account. This is generally a one-time fee which you are required to pay when you open the account. However, not every broker in India charges this fee. Rather than focusing on whether or not a broker charges account opening fee, ensure that you consider all the factors discussed in this post when selecting a broker for your demat account.
- Annual Maintenance Fee
Apart from the brokerage and account opening fee, there are some additional charges, like yearly maintenance fee that you are required to pay for a demat account. Your broker charges this fee on an annual basis and can significantly vary between brokers. Apart from this, there can be charges for account statement and advisory fee that you should check when selecting a broker.
- Trading Platform
The trading website or platform offered by your stockbroker is also an important consideration. While most people only focus on the brokerage and other charges of the account, the trading platform is equally important. Make sure that the platform or website offered by the broker is easy to use, offers live prices, latest market news, and more.
- Mobile Availability
Many of the best demat account providers in India now also offer mobile trading through apps. This can be very important if you are someone who doesn’t really get a lot of time to sit in front of your computer for trading. The on-the-go trading ability of mobile apps offers utmost trading convenience. Just like the online platform, the mobile app too should be user-friendly and have all the latest features.
Online trading has done an excellent job of replacing the traditional way of trading through physical share-certificates. This has made stock trading more accessible and easier even for new traders. Now that you know the factors that you should consider when selecting a demat account, start your research to get an account as quickly as possible and begin trading.