If you are a trader or an investor in the capital markets, you must’ve heard this pro tip from fellow market enthusiasts: Monitor your holdings regularly!
Well, your mates aren’t wrong. There are benefits of this habit and we are going to list six of them in the article below.
But if you are new to capital markets and you haven’t taken the first step yet, you can click here to open a Demat account. For the newbies, we will begin with the very basics by breaking down what is a Demat account.
A Demat account is an electronic account that enables holding financial securities in the forms of shares, bonds besides mutual funds. It operates much like a bank account but the Demat account keeps securities digitally in a safe way. Consequently, share certificates aren’t required in physical form and the user can save time and risks thereby.
Trading online with no hassle of paper documents is possible with a Demat account. It decreases the risks of theft, damage, or harm to securities and lessens the complexities involved in a transaction.
To open a Demat account, an investor should approach a Depository Participant who is registered with either the National Securities Depository Ltd (NSDL) or the Central Deposit Depository Services Limited (CDSL). The process entails typically submitting identity proof, address proof, PAN card along other essential documents.
What is a Statement of Demat Account Holding and what does it entail?
A Statement of Demat Account Holding is an itemized listing of the stocks or other securities held by an account holder within his Demat Account. Rather than utilizing the conventional paper-based share certificates, the demat holding statement keeps electronic records to help individuals organize as well as monitor the overview of their investments. This list contains some needed details regarding the number of shares, acquisition cost, and market value, hence turning into a crucial instrument for investment tracking and managing functions for the investor.
This statement simplifies portfolio management, allowing investors to make informed decisions on buying and selling securities. The centralized management of stock exchanges further enhances efficiency by streamlining fund flows and facilitating seamless trading operations.
It allows tracking of dividends, bonuses along other business actions. Additionally, it is indispensable for taxation purposes since it will contain data required to ascertain capital gains or even losses.
Depository participants generally issue these statements each month, quarterly, or whenever requested. Investors can access them either via electronic mode by email or even through printed papers delivered to their registered address.
The next intuitive question that would come to anyone’s mind would be: How to download this statement?
We’ve got you! Follow the steps provided below:
1. Login to your DP account: Login by making use of your credentials on your Depository Participant’s site.
2. Find the option to download the statement: You will be able to download the statement from either the ‘Accounts’ or the ‘Portfolio’ ‘tab.
3. Select Date Range: Choose a download period, for instance, every month, quarterly, or yearly.
4. Choose Format: You’ll find an option to download a PDF or Excel format.
5. Download Statement: Right after filling out the information you might click the ‘Download’ button on your computer.
6. Access Password Files: The file will request a password that the DP provides.
7. Check your statement: Verify all the details. Any mistakes, alert your DP quickly.
Why is it crucial to keep track of your Demat account statement?
To efficiently manage your investments, you must frequently check your Demat Account Holding Statement.
1. Frequent Updates: It lets you know frequently regarding your portfolio performance.
2. Fraud Detection: For your security and protection, this step helps you immediately spot any improper or illegal transactions or entries
3. Make the right Buy and Sell choice: Allows you to do this based on trends of performance
4. Capital gains/loss: to be decided at the time of tax compliance
5. Maintaining records A detailed history of your transactions and assets periodically.
When should you check your Demat account holding statement?
SEBI guidelines for Demat accounts state that they function on the T + 1 or T + 2 settlement cycles. The shares are credited to your Demat account within one to two working days or weeks after you buy them, which happens to be an outcome of this.
The process begins with placing a purchase order through your trading account, after which the shares are transferred from the stock exchange to the broker’s pool account. Next, the required payment is debited from your bank account. Finally, the broker deposits the shares into your Demat account, and the transfer is reflected in your Demat holding statement.
Reviewing your Demat account holding statement regularly helps verify the accuracy of your holdings and provides numerous benefits, including better oversight and control of your investments.
Here are a few benefits:
1. Real-time monitoring: Know how your portfolio is performing at any given time.
2. Instant fraud identification: Catch unauthorized transactions as soon as possible.
3. Optimized Investments: Monitor and adjust your portfolio to achieve your financial goals.
4. Simplified Taxes: Use the detailed records for capital gains calculations and filings of tax. Maintain accurate records
5. Journal maintenance: Maintain a complete journal of your securities and transactions.
6. Portfolio Diversification: Know things about overexposure and make changes to your portfolio.
You can follow these steps to get your Demat holding Statement through NSDL:
1. Visit the NSDL E-CAS portal.
2. Enter your PAN and CASID, and the captcha code.
3. Get the statement to your registered email address.
Use the “Know your CAS ID” function in case you’re uncertain about your CAS ID. Type in your DP ID, Client ID and PAN to retrieve it.
A Demat Account Holding Statement is essential for investing, as it consolidates key information about your securities, including acquisition costs and current market value. This statement guides detecting fraud, planning investments, and ensuring overall tax compliance. Routinely monitoring your holdings helps maintain accurate records, diversify your portfolio, and make informed decisions with confidence backed by reliable data.
