Are Demat and trading accounts the same?


Are Demat and trading accounts the same?


No demat and trading accounts are not the same. They are two distinct accounts with distinct purpose and regulations. You use your trading account to place orders like buying and selling while demat account is a place where all your securities are deposited. You can open a demat account with any depository participant while trading accounts are opened with sub brokers.


Hi Sooraj,

In India, shares and securities are held electronically. This is in the dematerialised form. Also known as demat. The account used to store your shares and securities is known as a demat account. So, instead of holding securities in the certificate form, you hold them electronically. You can make use of an investment broker to open a demat account. A trading account is used to trade in shares and securities in the equity as well as debt market. The demat account is only used for storing securities and cannot be used for trading. So, trading and demat accounts are not the same. A trading account is often a platform provided by your broker for trading in securities. The trading account will be linked to the demat account.

BB Expert