Question

The purpose of opening a Demat Account with a Depository Participant (DP) is ______.

पर्याय

• For holding and transferring securities in the Demat form

• For entering into an agreement with broker

• For making payment to stock exchange for any purchase of securities

• For enabling cash transactions in the securities market

Answer 1

The purpose of opening a Demat Account with a Depository Participant (DP) is for holding and transferring securities in the Demat form.

Explanation:

A Demat (dematerialised) account, opened with a Depository Participant (DP), is used to hold securities (shares, bonds, ETFs, etc.) in electronic form and to facilitate electronic transfers/settlements of those securities. DPs act as the investor’s interface to the depositories (NSDL/CDSL) for dematerialisation, transfers, pledging and other Demat services.