Top Investment Options to Explore With Your Demat Account 

In this day and age, financial planning is not a luxury but a necessity. If you wish to invest your money in avenues that can help multiply it, you shall find yourself faced with a glut of options. From conventional instruments to ever-evolving market-linked instruments, from high risk bearing assets to those carrying low to moderate risk, there are various options you can consider. In order to invest in market-linked securities, you would require a trading account and a demat account. In this article, we shall explore the trading and demat account opening process and the prominent investment options through such accounts. 

Demat account opening process 

Demat and trading accounts are pivotal pillars of the operational framework of the securities market. While a trading account is essential for the placement, matching, and execution of orders with stock exchanges, a demat account is necessary to securely hold the purchased assets in a dematerialised form. The trading and demat account opening process is as follows:

• Select a stock broker to open your demat and trading account. 
• Visit the selected stock broker’s official website, and fill the account opening form. 
• Submit the aforementioned form as well as the required supporting documents. 
• Carry out the step of In-person Verification. 
• Access your demat and trading account after receiving intimation about account opening from the broker. 

Prominent Investment Options Through a Demat and Trading Account 

One of the facets that makes the securities market dynamic is its diversity. You can invest in different types of asset classes based on your investment goals and preferences. Furthermore, you can invest in various sectors, ranging from Information Technology to Real Estate, Banking to Fast Moving Consumer Goods. Here are some of the prominent investment avenues you can access through a demat and trading account. 

• Equity Shares: As is evident from the name, equity shares provide partial ownership of the issuing company to the investors. Each equity share bears a face value and a market value – the latter being subject to change based on various market events. You can invest in equity shares of a company during initial issue (IPO), subsequent issues (FPO), Offer for Sale (OFS), or open market trading once the shares have been listed. 

• Mutual Funds: Another significant investment option you can consider is mutual funds. Such funds pool money from various investors and invest the same in varying assets. As such, you can invest in equity mutual funds, debt mutual funds, or hybrid mutual funds. You can purchase the units of a particular mutual fund during initial issue, during a subsequent issue, or through the open market. With mutual funds, you can either opt for lump sum investment or Systematic Investment Plans (SIPs). 

• Exchange Traded Funds: Should you wish to invest in an avenue that offers ample diversification through a single investment, Exchange Traded Funds (ETFs) can be ideal for you. You can invest in Equity ETFs (that invest in a basket of equity shares), Debt ETFs (that invest in a collection of debt securities), Gold ETFs (that invest in 99.5% pure gold), etc. 

• Sovereign Gold Bonds: ETFs are one of the alternatives to physical gold, and Sovereign Gold Bonds are another. Issued by the Reserve Bank of India on behalf of the government (hence the term sovereign), these bonds carry a maturity period of eight years and a fixed rate of interest (present rate is 2.5 per cent per annum). You can invest in SGBs through your demat account when a new issue is live. Investments in SGBs are in multiples of one gram. 

The bottomline 

You can choose which securities to add to your investment portfolio based on your investment goals, risk tolerance, investment timeline, preference for liquidity, expectation of return, etc. With a trading account and demat account, the process of investing in various securities traded in the market is extremely secure, highly transparent, and cost savvy.