The stock market has always generated a lot of attention among people as far as creation of wealth evolves. But being a money minting route there is always a scope for fraudulent activities to take place. The nature of fraudulent activities creates a sense of panic in the minds of investors who are planning to enter the market. In order to deal with this fear let us figure out the protocols associated with the best demat account as this has a crucial role to play as far as wealth creation is concerned.
Is it possible to buy or sell shares with a demat account?
No it is not possible to buy or sell shares with a demat account as you might need a trading account. The moment a broker opens up a demat account at a parallel level, they go on to open a trading account along with it. Basically this account is like a savings account where any form of buying or selling of share goes on to take place.
I am not planning to invest in stock market, so I do not need a demat account
Till this point of time demat account is not a mandatory option to be investing in all type of financial assets. But this is of importance if you are planning to invest in stocks. Apart from stocks an investor has bonds along with a host of financial instruments where they can invest. So if you are planning to invest in any of the above assets it is mandatory that you have a demat account. Any possibility of theft or fraud is reduced once you are going to have such an account in the first place.
Whether investments in demat account is safe or not
It has come to the fore that SEBI is a watch dog of the securities market. In the stock market demat account has a crucial role to play. Any rules along with regulations are under the framework of SEBI where the investors are protected from any type of fraudulent activities.
Apart from stringent measures by the regulatory body, a suggestion for an investor is to regular update their personal details and inform the broker whenever there is a change. Even the DP send out consolidated statements to the customers on a quarterly basis. So it is possible to keep a check on your accounts with the help of it. Once the shares are in your account it is not possible for a broker to take out anything without your consent and if they did then SEBI is there to safeguard your interests.
To sum it up the demat account has an important role to play in terms of wealth creation. But the choice of such an account is not a sole discretion basis. No one can force you to open such a account. If your broker forces you to do you can complain directly to the SEBI.