International 
Introduction
In India, shares and securities are held electronically in a Dematerialized (or “Demat”) account, instead of the investor taking physical possession of certificates. A Dematerialized account is opened by the investor while registering with an investment broker (or sub-broker). The dematerialized account number is quoted for all transactions to enable electronic settlements of trades to take place. Research of this topic examines influences for open the demo account and trading account in trading in the stock exchange. Further, this study uses of demat account, importance’s, investor’s perceptions act. The mainly data collected through web based analysis. The respondents were selected from the Thiruvananthapuram district through the selected stock brokers office. The study was undertaken with a well-structured questionnaire, duly filled by the respondents with varying importance, uses and investors' perceptions. The questionnaires were distributed online.
Benefits
Dematerialisation (or Demat) signifies the conversion of a share certificate from its present physical form to electronic form for the same number of holdings. It is a direct application of scope provided by the tremendous progress made in the area of Information Technology, whereby voluminous and cumbersome paper work involved in the scrip based system is eliminated. It offers scope for paperless trading through state-of-the-art technology, whereby share transactions and transfers are processed electronically without involving any share certificate or transfer deed after the share certificates have been converted from physical to electronic form. Demat attempts to avoid the time consuming and complex process of getting shares transferred in the name of buyers and also aims to shirk inherent problems of bad deliveries, delay in processing, fraudulent interception in postal transit, etc. Dematerialisation of shares is optional and an investor can still hold shares in the physical form. However, he/she has to demat the shares if he/she wishes to sell the same through the Stock Exchanges. Similarly, if an investor purchases shares, he/she will get delivery of the shares in demat form.
How it works
The operations in the Depository System involve the Depositories, Depository Participants, Company/Registrars and Investors. A Depository (NSDL and CDSL) is an organisation like a Central Bank, i.e. Reserve Bank where the securities of an investor are held in the electronic form through Depository Participants. A Depository Participant is the agent of the Depository and is the medium through which shares are held in the electronic form. They are also the representatives of the Investor, providing the link between the Investor and the Company/ Registrar through the Depository.
To draw an analogy, the Depository System functions in a manner similar to a banking system. A bank holds funds in accounts whereas a Depository holds securities in accounts for its clients. A bank transfers funds between accounts while a Depository transfers securities between accounts. In both systems, the transfer of funds or securities occurs without the actual handling of funds or securities. Both, the bank and the Depository, are accountable for the safe keeping of funds and securities respectively. The Company signs an Agreement with NSDL/CDSL (the depositories) and installs the necessary hardware/software for operations.
How to proceed with your shares
First, please open an account with a Depository Participant (DP) and obtain a unique Client ID number. Thereafter, kindly fill up a Dematerialisation Request Form (DRF) provided by the DP and surrender the physical shares intended to be dematted to the DP. Upon receipt of the shares and the DRF, the DP will send electronic requests through the Depository to the Company/Registrar for confirmation of demat. Each request will bear a unique transaction number. Simultaneously, the DP will surrender the DRF and the shares to the Company with a covering letter requesting the Company/Registrar to confirm the demat. After verifying the documents received from the DP, the Company/Registrar will confirm the demat to the Depository. This confirmation will be passed on from the Depository to the DP, which holds your account. After receiving this confirmation from the Depository, the DP will credit the account with the dematerialized shares. The DP will then hold the shares in the dematerialized form on your behalf and you become the beneficial owner of these dematerialized shares.
Advantages of Holding two trading accounts with two different brokers
Advantages of two or more Trading a/c’s: isn’t much, may be little bit of reduced brokerage and/or different trading platforms (depends on your individual likeness and priorities).
One more benefit of having two demat is that you do not have to worry about FIFO share debit rule.
For eg. If you are swing trader or if you want to sell the share in short term then share will be debited in First in First out order.
But FIFO rule is applicable to only one account so if you have two demat accounts then you can pick one account for long term and keep another for short term trade for same scrip..
Disadvantages of Holding two trading accounts with two different brokers
One disadvantage can be, you have to bear account opening charges, you have to keep track of activities in two or more trading a/c’s.
Second disadvantage can be; you have to bear annual maintenance charges of Demat a/c’s whether you use it or not.
