Is Intraday Trading possible without a Demat account?

Last Updated: 16 Oct 2024

The world of online trading has become increasingly more accessible and convenient for both new and seasoned participants in financial markets. Today, traders and investors can execute and manage trades at lightning-fast speeds, at any time. Online trading has become so prevalent that an increasing number of people today dabble and even make a living with the high-speed world of intraday trading.

The world of Intraday Trading

For most traders, dealing in the financial market is typically viewed from two perspectives. The first of these perspectives is long term investment, wherein you buy the stocks of a company hoping to profit from its growth. and the other is short term trading, which can further be narrowed down to intraday trading wherein stocks are bought and sold within the same day.

Intraday Trading without Demat Account

For any type of transaction in securities, you need to have a trading account. This is because that allows you to facilitate the purchase and sale of your securities on the relevant exchange. In the case of intraday trading, a significant portion of the trading is done in futures and options contracts. All that is required for such transactions are cash. Therefore, a trading account is generally enough for such transactions and you may not need to open a demat account online.

Benefits of Demat Accounts

Hence, whether or not you need to open a Demat account online depends on the type of trades you typically execute. For traders looking for long term investment in equities, opening a Demat account is essential. However, for those looking to conduct intraday trading in futures and options, Demat accounts might not be essential.

However, opening a Demat account online with your trading account can offer several benefits, such as safety, accessibility and security of your shares.

How to open a Trading and Demat Account

• Visit the website of your choice of Depository Participant (DP).
• On the website of the DP, search for and select the ‘open a Demat and trading account’ option.
• Next, fill out the account opening application with all essential and updated information.
• Upload scanned copies of required KYC documents such as PAN card, proof of identity etc.
• Go through the official agreement presented by the DP and if found satisfactory, sign the document by affixing your signature.
• Once all the relevant documents are submitted, your application will be processed by the DP.

Conclusion

Whether you are looking to join the growing number of India’s intraday traders or to start investing long term in the market’s movement, you need the right company to get you started. To that end, open a free Demat account as well as a trading account with IIFL where you can get an all-in-one account and trade in multiple securities online.