If you are looking to invest in stock markets, then it is of paramount importance to know about your statement of Demat holdings. Let us understand this with the help of an example. If you were to deposit a cheque in a bank, then you will – after taking into account the time taken for clearance – check your account’s statement. Similarly, when you sell or purchase a stock, then you will have to check whether it is debited or credited in your Demat Account by looking in the statement of Demat holdings.
Understanding Demat account :
Once you have decided to invest in share markets, foremost you are required to open a Demat account with a Depository Participant (DP). DPs are broking firms registered with either the National Securities Depository Limited (NSDL) or Central Depository Services (India) Ltd (CDSL). From a DP’s perspective, your Demat account is also known as a client Demat account or a client beneficiary account.
A Demat account can hold a wide array of stock market investments, including equity shares, Exchange Traded Funds (ETFs), Mutual Funds, bonds and government securities. A Demat account holds your equity shares in the electronic format, thus dispensing the need for cumbersome paperwork. Holding your shares electronically in the Demat account also provides for digitally secure transactions, eliminating the chances of fraud or human errors.
Here, you must remember that a Demat account just holds your stocks, and to commence trading in stock markets, you will also require opening a Trading account. The Trading account is, in turn, linked with your bank account. For instance, if you want to purchase a share, the purchase order will be processed via your Trading account, and credited in your Demat account. The charges for purchase will be subsequently deducted from your banking account. You can then check for the purchase of shares in your statement of Demat holdings.
When should you check your Demat account holding statement?
As per SEBI’s regulations, every sale or purchase on a given trading day’s session, gets reflected in an investor’s Demat account after T+2 (Transfer+2 days). This means if you have purchased a stock, the requisite transfer will be reflected in your account after two working days. Here it is important to know the steps involved in the transfer:
– First, you order for purchase through your trading account
– Second, the broking firm will receive the shares from the stock exchange in its pool account.
– Third, the funds have to be cleared from your banking account.
– Fourth, the broking firm transfers the shares in your Demat account within the stipulated time.
Once the shares are transferred, it will be accordingly reflected in your Demat holding statement.
Importance of regular monitoring of your statement of Demat holdings :
It is important to regularly monitor your Demat holding statement to ensure that the requisite transfer of shares have been made to your Demat account. While in the majority of cases, the transfer takes place as a matter of course, there could be an element of chance of an error. It could well be possible that the shares are still kept in the broking firm’s common pool account, and utilized to fulfil the margin requirements of other clients. In such a scenario, not only do you face the threat of losses from your investments, but also stand to lose corporate action benefits, like dividends, stock splits, and so on.
While investing in stock markets, you should always look for a broking company which emails yourdemat account holding statement on a regular basis, besides providing SMS-based alerts on your transactions.
How to view your statement of Demat holdings directly?
If you wish to view your Demat holdings directly, then you can do so through the web portals of the two national depositories: NSDL and CDSL. Your Demat account number will allow you to identify which depository you are registered with. While NSDL-registered accounts have a 14-digit numeric number along with the prefix: ‘IN’, those with the CDSL have a 16-digit numeric number. In the case of your Demat account being registered with NSDL, you can use their IDeAS service to view your holdings. You can register for this service at: https://esevices.nsdl.com
If your account is with CDSL, you can use the ‘Easi’ online service – similar to IDeAS – to view your statement: https://web.cdslindia.com/myeasi/registration/Easiregistration. Once you register with any of the depositories, you can get access to your demat account holding statement directly, without the need of approaching the broking firm. You can also download your Consolidated Account Statement (CAS) to analyse the comprehensive list of your holdings.
Thus, your statement of Demat holdings allows you to verify your stock market investments. While starting your investment journey in stock markets, it is always advisable to choose a trusted and reliable financial partner. Look for facilities, like 2-in-1 Demat-cum-Trading accounts along with the features of SMS-based alerts on each transaction. Remember, a trusted financial partner also allows for easy online access to your demat account holding statement on its website, besides providing the benefit for quick CAS download.