Stock Market is a place where people buy and sell financial securities. Share Market is categorized into two types:
Primary Market:
When a company first registered to raise capital for the business through issuing shares in the share market. This form of the market, known as the primary market. If any company is offering its share for the first time, which generally termed as Initial Public Offering and popularly known as IPO.
Secondary Market:
After the securities are introduced and sold in the primary market, they become the part of the secondary market for future trading purposes. In the secondary market, traders and investors may easily buy or sell their shares. Here, generally, stockbrokers perform the trade activities.
In stock market, there are a variety of financial instruments traded like mutual funds, equities, bonds, corporate bonds, etc. For trading in the stock market, it is necessary to open a trading account and a DEMAT account. A Demat account is used to store securities in electronic or digital format. Along with a Demat account, to initiate and conduct transactions in the stock market it is necessary to have a trading account.
How to open a Demat account online?
The process to open a DEMAT account online is much simpler and quicker. Let’s take a look at the process or steps to open a DEMAT account online. The steps are as follows:
- Choose a stockbroker registered with NSDL and CDSL, either of the two exchanges.
- Visit the website or mobile application of the selected stockbroker.
- Fill in the basic details like name, email address, and contact number.
- Complete the KYC.
- Submit the documents for the verification.
- Sign the agreement stating rights and duties as an investor.
- Receive your Beneficial Owner Id (BO ID). This ID is required to initiate the trading and investing activities.
Now when we are aware about how to open a Demat account online. Let’s take a look at the checklist for documents required to open a Demat account.
Documents Required to open a DEMAT Account:
The documents required to open Demat account are as follows:
- A proof of Income
- An Address Proof
- An Identity Proof
- PAN Card
- Proof of Bank Account Statements
- Passport size photo in digital format
- Copy of signature in digital format
Detailed information about types of document required to open a DEMAT account
Identity Proof:
- Aadhar Card, Voter ID card, Driving License documents containing Unique Identification Number will serve the purpose of proof of identity.
- Identity Proof must contain the photo of an applicant. However, the identity proof can be issued by any Central, State, and regulatory authorities.
Proof of Income:
- A copy of Income Tax Returns commonly known as ITR’s acknowledgment slip used during the process of income tax filing.
- A certificate of Net Worth issued by a Chartered Accountant
- Salary Slip will also serve the purpose for income proof
Proof of Address:
- Ration Card, Voter Id Card, Passport, Lease Agreement, Driving License, Maintenance Bill for the flat. Copy of Insurance
- Banks’ Passbook i99or Bank Account Statement Copy, reflecting 3 months statement
- Electricity Bill, Gas Bill, or telephone bills for the last three months only will serve the purpose for address proof
Note: Proof of Address in the name of the spouse is also accepted
- Gazetted Officer, Manager of any financial institution or an authorized bank (Name and Designation along with seal should be attached with the copy of the document)
- For NRIs, officials of an overseas authorized branch of Scheduled Commercial Banks, Indian Embassy/ Consulate General of the country where the client lives, can attest the documents
