Now Lets Talk About Demat Account :

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Lets know full-form of DEMAT A/C first , its called dematerialization account. It’s an account where your bought shares will be deposited in electronic format like how your money is kept in your savings account as electronic format after deposit. There is a term called DP(depository participant) who has a right to open up demat accounts & most of the brokers have got this DP license to open up a demat account for you.So while you approach a broker, ask him whether he is a DP or not & if he is a DP,it means he has the right to open a demat & trading a/c for you.So every broker can open a trading account for you,but to open demat account for you,he needs to be a DP himself – so ask him whether he is a DP or not as your both the accounts should stay with the same broker for your comfort.
SO the key point is : Your trading account is opened to buy/sell shares after you deposit money in it. Once you buy shares in trading a/c, those shares will be transferred from your trading account to your opened DEMAT account. Now whenever you want to sell off those shares, you will have to sell it in your trading account ...
... & profits or losses after selling off your shares will be deposited back into your trading account.Now if you wish, you can have a withdrawal of your money from trading account.For fund withdrawal,place a request to your broker. Once broker process your withdrawal request , you’ll receive back your money in your bank account.Remember, there is no cash transaction in stock market.When you deposit money in your trading account, you’ll have to transfer funds or deposit a cheque or demand draft in your trading account.
Along-with providing you online trading platform, broker also provides you offline trading facility.In offline trading facility, you’ll have to call up the broker & instruct him what shares you want to buy/sell instead of doing it on your own using the online trading software or platform.So it’s your wish which service you choose. Some broker provides both the facilities & some provides any one of them between online trading & offline trading.
What are the paperwork required to open an account ? listed below are the list of documents required:
(1) PAN CARD (2) 6 months bank commentary (three) passport dimension picture (four) address proof
Lets be mindful what's the dealer’s benefit in providing all these products and services to us or it’s clients:
He earns commission from us for the service he provides.
what is the structure of the commissions he makes then ? We’ll discuss briefly about this topic later however for now,lets have a common idea on this :
feel,
you wish to have to speculate Rs 60,000/ in stock market. hence you deposited Rs 60,000/ for your buying and selling account to be able to purchase shares. You analyze the market & see TATAMOTORS will probably be a just right bet for creating wealth.Lets suppose, inventory worth of TATAMOTORS is Rs 500 per share & you determined to buy 100 qty of shares.
So, you obtain one hundred shares of TATAMOTORS on the price of Rs 500 per share.
Your whole funding turns into Rs 50,000/
Then is Rs 10,000/ left for your account ?????????????? “NO”. You didn't depend the price of your accomplished trade.There are some prices you’ll need to endure while you purchase shares in addition to sell-off your holdings or shares & this price structure is known as “TRANSACTION cost”. because the identify suggests, whereas doing a transaction in shares,these are the types of value you’ll need to bear whether you're making profits or loss. under are the forms of prices :
trading or funding price = Brokerage + STT + Stamp responsibility + service tax + other fees
Lets go one at a time :
Brokerage : this is charged by way of the broker as his commissions. making an allowance for above examples , whilst you had a transaction of Rs 50,000/ , dealer charges you a commission of 0.three% on the transaction quantity which is Rs a hundred and fifty/. Lets suppose, after per week the stock shot up around rs 550/ per share & you thought about taking the income of Rs 50/ per share.so that you unload your 100 shares that you simply sold for rs 500/ per share.Now whereas selling off, you’ll once more have a transaction of Rs fifty five,000/ & the dealer will again charge you a fee of 0.three% on that which is Rs a hundred sixty five/.So in this entire change, you made a complete revenue of Rs 5000/ by using buying & promoting shares & your price of broker fee is Rs 315/( rs 150 while shopping for & rs a hundred sixty five while selling ).So internet profit gained after brokerage is Rs 4685/ ( rs 5000 of complete revenue – rs 315 brokerage value). Don’t feel free as i did not deduct other charges but!!!!!! Pls be aware : totally different brokers cost completely different quantity of commissions. in line with me, zero.2% is an ordinary fee pattern & you should no longer open an account with a broker who prices you greater than zero.2%.
There are some extra themes to talk about when it comes to brokerage construction later when we end up following few issues.
Now , lets discuss other prices like STT , stamp duty , provider tax , sebi turnover tax and so forth. All these costs are from indian govt hence you can not do anything else about it.below i've attached a number of screenshots of these fees from NSE INDIA's reputable website online.just have a look at these expenses & don't get puzzled if you are no longer able to consider the terms & calculations as these prices can be simply understood once you strat actual-time buying and selling with a dealer and also it can be your broker's responsibilty to make you remember all these different fees.
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