What Are The Benefits & Importance Of Dematerialisation?

 


Dematerialisation refers to the process of converting physical shares into electronic format. When the shares or other securities are available in electronic form, it becomes easier to transact in them. Dematerialisation is necessary because the manual process of trading has been outdated. Also, dematerialised securities provide far more convenience and safety to your financial holdings. The transactions can be carried out safely when the shares are available in electronic form. The other benefits of a Demat account include the elimination of thefts, damage, and other risks associated with physical securities. 

The transactions made using a Demat are safe as the Demat account providers encrypt the data and offer an extra authorization process to ensure the safety of the transactions. You can also appoint a nominee to trade on your behalf in your absence. Dematerialised shares negate the need for paperwork and facilitate a faster and more convenient trade settlement process. You can avail of a loan against the holdings in your Demat account. A Demat account enables you to track and monitor your investments from any part of the world. You can buy or sell shares in odd lots which were not possible with a physical form of trading. It is possible to hold multiple financial instruments like stocks, mutual funds, ETFs, corporate bonds, and government securities if you own a Demat account. 

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