When I wanted to know about share market investing, I just typed "how to invest in shares" in google and looked for a detailed answer. Most of the time I got a high tech, high funda output but none of the thing helped me as a layman when I was looking for the first brick to build my house .I just learned by inquiring and practically working on several issues. Now I am an MBA student which further helps me in enriching my knowledge. I am just publishing this article to help beginners practically how to start with stock market investing.
To start investing in share trading, we have to open an account called "Demat account" which is called as dematerialised account.
What is a Demat Account?
It is an account which can be compared to a bank account wherein here your shares are in electronic form with its respective value (either purchase price or selling price). Don't get bogged down by high fundas like "Demat Account". In simple words, instead of having shares in paper form we are having it in electronic form .That's it! In early days, stocks and shares are traded in paper form by people gathering in stock exchanges and showing signs of company and price through signals. Even now Chicago stock markets operate in this way. The highest bidder or the one who is quoting for highest price will be awarded the shares. Now you can trade electronically and so you need an electronic format and hence demat. The reverse of "demat" is "remat" and it is not our concern now.
What should I do to open a Demat Account and where?
You can open a demat account with depositary participant (DP). You can compare this DP with a bank. They will charge you for every purchase and every sale you make. To find a list of DP you can type "Depository Participant" in the search engine and find a one close to your location. Some of the notable ones are India bulls and geogith. And most of the banks like ICICI also provide you this option.
What should I have to open a Demat Account?
- You should have a three months bank statement.
- PAN Card.
- An identity proof.
