What are the Different Investments for Which Demat Account is Used?

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Demat account can be used for a number of investments and not only for buying and selling shares, as the general perception is. Take a look at the numerous places in which you can use your demat account. Click to know what are the charges payable for opening and maintaining a Demat Account.

What are the Different Investments for Which Demat Account is Used?

Equity

You need a demat account if you want  to buy and sell stocks through the recognised stock exchanges in the country.This is because it is compulsory to buy and sell through demat account, if you are doing so through stock exchanges.

Initial Public Offer (IPO)

 One can also apply for IPOs as per your convenience using your demat account. After applying one can also track the status and analyze the forthcoming IPOs. This will help you save time and avoids filling lengthy forms. One can just log in and select IPO option and fill the price and quantity.

Systematic Investment Plan

This option is offered by few banks such as HDFC Bank, where one can buy pre-specify the quantity of stocks/units at regular intervals over a period of time. An SIP allows you to invest without having to worry about the ups and downs of the markets. Click to know more about SIP.

Rajiv Gandhi Equity Savings Scheme (RGESS)

 If you are a new equity investor, you can invest in RGESS and save taxes for three consecutive years. Click to know more about RGESS.

Individuals with a gross annual income of up to Rs 12 lakh can avail a deduction of up to Rs 25,000. This deduction is subject to maximum investment limit of Rs 50,000 under Section 80-CCG.

Gold ETF

One can also use the demat account to buy gold ETFs in the electronic form. Gold ETFs are listed and traded just like a stock. 

Fixed Income

From your demat account one can invest in highly rated debt instruments with high rate of return such as highly rated bonds and highly liquid NCDs.

Mutual Funds

Go paperless by investing in Mutual Funds from your demat account. You have the option to purchase and redeem mutual fund units online just like stocks through your trading account.

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Read more about: demat, investment, mutual funds, ipo
Story first published: Thursday, January 29, 2015, 12:48 [IST]
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