How to buy and sell shares using a Demat account?

A Demat account, short for Dematerialized account, is an electronic account that holds your shares and securities in a digital form. It allows you to buy and sell shares electronically, eliminating the need for physical share certificates. This article will explain the steps to buy and sell shares using a Demat account.

Buying Shares Using a Demat Account

Open a Trading Account – To buy shares using a Demat account, you must first open a trading account with a stockbroker. A trading account allows you to buy and sell shares on the stock exchange. To open a trading account, you must provide your PAN card, address proof, and bank details. And then you know Trading account?

Place an Order – Once your trading account is opened, you can place an order to buy shares. You can do this by logging in to your trading account and selecting the shares you wish to buy. You can enter the quantity and price you wish to buy the shares.

Pay for the Shares – Once you have placed an order, you must pay for the shares. You can transfer funds from your bank account to your trading account. Most stockbrokers offer payment options, including net banking, debit card, and UPI.

Shares Credited to Your Demat Account – Once you have paid for the shares, the shares will be credited to your Demat account. You can check the status of your shares by logging in to your Demat account. The shares will be available for you to sell or hold in your Demat account.

Selling Shares Using a Demat Account

Once you know how to open a trading account then you can proceed with it.

Place an Order to Sell Shares – To sell shares using a Demat account, you must first place an order to sell the shares. You can do this by logging in to your trading account and selecting the shares you wish to sell. You can then enter the quantity and price you wish to sell the shares.

Shares Debited from Your Demat Account – Once you have placed an order to sell shares, the shares will be debited from your Demat account. This means the shares will no longer be available to hold in your Demat account.

Receive Payment for the Shares – Once the shares have been sold, you will receive the payment for the shares in your trading account. You can then transfer the funds from your trading account to your bank account.

It is important to note that charges are associated with buying and selling shares using a Demat account. These charges may vary depending on the stockbroker and the number of traded shares. Therefore, it is recommended that you check the charges with your stockbroker before placing any orders while doing with how to open a trading account.

Thus, buying and selling shares using a Demat account involves:

  • Opening a trading account.
  • Placing an order to buy or sell shares.
  • Paying for the shares.
  • Receiving the shares in your Demat account.
  • Selling the shares by placing an order.

It is essential to ensure that you have sufficient funds in your trading account before placing any orders and that you know the charges associated with buying and selling shares using a Demat account.