Let’s take an instance, whenever we withdraw money, we keep or store our money in a locker. Or if you want to deposit your money, banks are there for depositing. So let’s use this example for share also – Can you keep shares in a store or in Bank Account. The answer is very obvious – “No“.
So, where can you keep the shares you have bought? That’s where the Demat account comes into play to store our purchased shares. So, it’s more or less like your own personal store to put shares. In simple words, Demat account works as a bank where bought shares are deposited in or where sold shares are taken from
Now we are done with storing what if you want to use some or all stored shared and sell those shares then we need a trading account. In short, trading account enables traders to buy and sell shares in the stock market.
Some of you must wonder that we have the same account for both. It depends on the broker for example if you have a Zerodha account, it might be possible that you have in Zerodha – Demat as well as a trading account.
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