3 Best Demat and Trading Account in India 2021

 Best Demat Account in India – 2021

We are always in search of Best Demat and Trading account in India. I started my trading in 2009 – 2010 with a demat and trading account in Hedge equities. Hedge Equities was a full-service broker with Odin Diet as trading platform. They were a small firm based in Kerala.

Later I moved to sharekhan after seeing various advertisements in online and television. When I moved to Sharekhan, one thing I noticed was better customer service and more advanced Trade Tiger platform than in Hedge equities. It was a good option for an investor. But as I was mainly a trader, brokerage was still an issue with a full-service broker like sharekhan. Sharekhan charged me the brokerage of 0.5% on delivery and 0.1%. on intraday. 

Then in 2016, I met Mr. Sanoob Siddiq who is running a brokerage firm and a stock market related youtube channel. He suggested me to trade in a discount brokerage firm. Zerodha was main discount broker at that time. After moving to zerodha, I was surprised when I saw the change in brokerage expense. Before that I never had an idea about the concept of discount brokerage and their benefits. Later I decided to research more about stock brokers in India. When I started to learn more about each, I understood one thing. Each broker had its own USP. Some stock broker was focusing mainly on providing low brokerage, some were giving high leverage for traders. There were some brokers who were mainly focused on improving their trading platforms and giving better trading experience for their customers at low cost. We will discuss about all these.

Before we check the list of top demat accounts of India and compare them, let us quickly understand few basic things about demat account. We will discuss basics of demat accounts, difference between demat and trading account and then who is my favorites among the best demat accounts.

What is a Demat Account?

Demat account, short form of demilitarized account is used to hold shares and securities in electronic form. In India, it has now become mandatory to hold the shares in demat form only. Some people still hold shares in paper certificate format. They should convert them into electronic form before they can be sold at stock market. Demat account has many advantages compared to earlier physical formats. Most important among them is it is safe from events of damage and theft.

If you still haveshares in paper certificate format, you can contact any stock broker, they will help you to convert it. I will write a post about detailed procedure to convert shares in paper certificate form to demat in later.

Depositories

Stock Brokers are basically members of Depositories like NSDL and CDSL. Your shares are maintained by these depositories. So even if stock brokers goes bankrupt, you shares are safe with depositories. You can check status of your stock holdings by creating a login in these depository websites or mobile apps. We will discuss more about depositories and how you can check your holdings in their website, in another post.

Now we will discuss what is the difference between Demat account and a trading account.

What is the difference between Trading and Demat account?

 

In simple words, we can say Trading account is Interface and Demat account is storage. You buy and sell shares on stock exchanges such as NSE and BSE though Trading account. The purchased shares are stored in your demat account. On sale, they are debited from demat account. 

Interesting part is, it is possible to have trading account with one broker and demat account with another. But its better to have demat and trading account in India with a single broker. I had faced some issues when I linked my zerodha demat with fyers. Some times it wasnt displaying my holdings. Now most of the brokers compell to open demat and trading account with them only.

3 in 1 account

It is also possible to have trading, demat and savings account with a same broker and it is known as 3-in-1 demat account. Some banks were providing these 3 in 1 accounts. Now discount brokers like zerodha, upstox are also have  tie up with some banks to provide 3 in 1 accounts. You can opt for a 3 in 1 account while opening a demat account with them.

There are hundreds of registered stock brokers in India offering stock trading to retail customers. Stock brokers in India can be categorized into 2 types:

·        Full-services brokers

·        Discount Stock Brokers

Full-services brokers

Full-service brokers offer a wide range of services including stock trading, research and advisory and local support.

Eg : ICICI Direct, Sharekhan, HDFC Securities, Sharekhan, Angel Broking and Axis Bank.

Discount Stock Brokers

Discount stock brokers are online brokers specialized only in stock and commodity trading services. They do not offer add-ons like research and advisory, PMS, wealth management and branch support.

Eg : Zerodha, upstox, fyers.

                              

Ranking for Best Demat Account In India for 2021:

To find the best demat account in India, I created a list of demat accounts from registered stock brokers, then ranked them by a set of parameters.

Here is the list of top 10 best demat account in India based on active clients (January 2021). Zerodha is the top most stock broker among all the brokers in India since 2019.

1	Zerodha	2,923,141
2	Upstox	1,623,515
3	ICICI Direct	1,289,023
4	Angel Broking	1,221,008
5	HDFC Securities	889,126
6	5paisa	793,518
7	Kotak Securities	688,217
8	Sharekhan	632,476
9	Motilal Oswal	495,271
10	Groww	424,845

 

As I said before, each broker have its own specialties. They can be categorized as,

• Best Demat Account in India for Traders
• Best Demat Account in india for Investors
• Best 3-in-1 demat accounts in India

I have considered below parameters to find best demat and trading account in India:

• Brokerage and AMC Charges
• Trading Platforms including mobile app
• Customer Support (Online/Offline)
• Credibility of Sharebroker
• Number of Customers
• Margin/Leverage offered

Best Demat Account for Traders with Lowest Brokerage Charges In India 2021:

 We have discussed about discount brokers above. They are specialized only in stock and commodity trading services and don’t provide any other services like full service brokers. Normally the have very low or a flat brokerage structure compared to full service brokers.

Low brokerage demat account are best for traders who trade very frequently. Needless to say, brokerage is their main concern. Their profits would be eaten up by brokerage itself if they don’t choose the brokers well.

Discount brokers or flat fee brokers would be ideal for them through which one can save upto 90% when compared to full-service brokers.

The discount brokers levy lesser brokerage charges for their demat and trading accounts.

Zerodha, Upstox , Fyers are some of the well known discount brokers. Sharekhan, ICICIdirect and Motilal Oswal are some of the reputed traditional or full service  brokers who are good for investors.

How much you can save by choosing discount broker like Zerodha/Upstox?:

For Investor:

Let us assume are planing to invest Rs 10 Lakh. With 0.55% brokerage of ICICI Direct, you have to shell out Rs 5,500 in brokerage itself where as you pay nil in case of Zerodha (Investments are free at Zerodha).

Hence there will be 100% savings in brokerage charges when compared to brokers like ICICI Direct/Sharekhan.

For Trader:

Now let us see for intraday and Futures traders, how much can be saved.

Let us assume you buy Rs 10 lakh and sell 10 lakh worth of shares daily. That means in around 20 trading days of month it will be 400 lakhs.

ICICI Direct charges 0.0275% hence the brokerage charges per month is Rs400Lakh * 0.0275% which is Rs 11,000.

So yearly it would be,

Rs11,000 * 12 months = Rs 1,32,000

Now Zerodha/Upstox charge Rs 20/trade for intraday. In Zerodha, brokerage is not based on trade value. For each order they charge Rs20 irrespective of trade value.

Hence per day it would be Rs 40 (Rs20 for buy and Rs20 for sell) and for each month it would be 20* Rs40 = Rs 800

So per year it is Rs 800 * 12 months = Rs 9,600

Hence, traders can save more than 90% of brokerage which indirectly add to their profit.

1. Zerodha Demat Account

 

Zerodha is biggest stock broker of India based out of Bangalore based on number of active clients. They are the first to introduce discount brokerage concept in India. Zerodha offers retail and institutional broking, currencies and commodities trading, mutual funds, and bonds. It was founded in 2010 by brothers Nithin Kamath, Nikhil Kamath. In June 2020, Zerodha entered the unicorn club with a self-assessed valuation of about $1 billion.

As I said in the beginning, I opened a zerodha account after Sanoob’s suggestion in 2016. I traded for few months with a small amount to check platform reliability and safety. Later I moved all my trading capital to this.

Zerodha built their reputation over the time and people started accepting them gradually. They have the best trading platforms and other tools for traders and ivestors.

Today they have even overtaken the most reputed and well established names such as Sharekhan and ICICI Direct to become No.1 in India.

Best part of Zerodha is they don’t charge brokerage for delivery based trades. For intraday and derivative trading they charges Rs 20/executed order.

Their main business comes from derivatives. So they have waived off delivery brokerage to attract more customers. Hence, Zerodha offers Zero brokerage demat account for all investments.

If I have to list an issue, the only thing comes to mind is, some technical issues in their platform before few year years when there is high volatility in market. But they rectified it soon and there weren’t major issues like that after that.

Zerodha Brokerage Structure:

Segment	Zerodha Brokerage Charges
Equity Intraday	Rs 20/order or 0.03% which ever is lower
Equity Delivery	No Brokerage
Equity Futures	Rs 20/order or 0.03% which ever is lower
Equity Options	Rs 20/order
Currency Futures	Rs 20/order or 0.03% which ever is lower
Currency Options	Rs 20/order or 0.03% which ever is lower
Commodities	Rs 20/order or 0.03% which ever is lower

 

Following are the some of the features which I liked and disliked about Zerodha:

Pros:

• Free delivery based trades and maximum of Rs20/trade in other segments
• First Discount broker of India and Best discount broker with highest number of customers
• Taken initiative to educate common investors through open platform Zerodha Varsity
• State of the art trading platforms such as Zerodha Kite
• Direct mutual fund investment platform called Coin.
• Zerodha small case for thematic investment.
• Zerodha streak for algo traders
• Zerodha sensibul for option traders

Cons:

• Call and trade is chargeable

3-in-1 demat account available with IDFC First bank Savings account

Zerodha Account opening is completely online and 100% paperless if your mobile number is linked to aadhar number. It can be opened in 15 min. We have made a blog post here and a video in our channel about step by step procedure of opening Account with Zerodha

Zerodha Account Opening Charges:

• Equity Segment : Rs 200
• Commodity Segment : Rs 100

2. Upstox Demat Account

Upstox is another leading discount broker based out of Mumbai. They are no 2 after Zerodha. They were formerly known as RKSV Securities. 

Upstox is owned by Mumbai based RKSV Securities Pvt Ltd. Mr. Ravi Kumar, Mr. Raghu Kumar and Mr. Shrini Viswanath are the co-founders of the company. Upstox investor includes Tiger Global Management, Kalaari Capital Partners, GVK Davix Technologies. Ratan Tata also holds a small stake in this company.

Their brokerage structure is more or less similar to Zerodha.

They also charge Zero brokerage for delivery trades and Rs 20/trade for executed order. Account opening is also free with them.

They are backed by some of the reputed names such as Mr.Ratan Tata and Tiger global.

You can read my detailed review of Upstox here.

Upstox Brokerage Structure:

Segment	Upstox Brokerage Charges
Equity Intraday	Rs 20/order or 0.05% which ever is lower
Equity Delivery	No Brokerage
Equity Futures	Rs 20/order or 0.05% which ever is lower
Equity Options	Rs 20/order
Currency Futures	Rs 20/order or 0.05% which ever is lower
Currency Options	Rs 20/order or 0.05% which ever is lower
Commodities	Rs 20/order or 0.05% which ever is lower

Upstox Account Opening and AMC Charges:

• Trading Account Opening Charges : Free
• Demat Account Opening Charges : Free
• Trading Account Maintenance Charges : Rs 0
• Demat Account Maintenance Charges (AMC) : Rs. 25+ GST per month

Other advantages and disadvantages of Upstox are,

Pros:

• Zero commission on delivery trades
• Free Demat account opening and lower annual maintenance charges
• Maximum Rs 20 Per trade for non delivery trades
• Backed by likes of Mr.Ratan Tata and Tiger Global
• Superior Trading platform Upstox Pro
• Dedicated platform for buying mutual funds
• IPO application using UPI available

Cons:

• Call and trade is chargeable

3-in-1 demat account available with IndusInd bank Savings account.

You can contact them though the button below,

Once you enter the details, you will receive the OTP on mobile. After entering the OTP,  please enter PAN number in next screen.

Sales team will assist you only if you enter PAN number. That indicates them that you are serious in opening the demat account.

You can read more about them here : How to open upstox account online

3 : Fyers

                                       

Fyers is a fast growing discount broker based in Bangalore, Karnataka.

 

They provide some best trading platforms available in India. Their web platform is developed based on tradingview and have various tools usefull for traders. Their desktop platform Fyers One is also a feature rich platform for traders. They recently introduced a new mobile app for traders which is also one of the best among all brokers in India.

 You can read more about them here : All details about Fyers

 Pros:

• Zero commission on delivery trades
• Free Demat account opening ( Short time offer )
• Maximum Rs 20 Per trade for non delivery trades
• Superior Trading platforms like Fyers one, Fyers web and Fyers mobile app
• Dedicated platform for buying direct mutual funds
• IPO application using UPI available

Cons:

• Some recent technical issues.

Best Demat Account in India for Investors:

Investor’s requirement from a broker is totally different. They don’t need analysis tools designed for traders. One of the most important thing they need is good support from brokers.

Investor’s main aim is creating wealth in long term. So they wont be buying and selling stocks frequently. So brokerage wont affect them much.

So best option for them is a full service broker with good support. They may charge you high to compensate for these expenses. But if that is not a problem, it is best option for you. I suggest you to go with leaders in that segment. Some of them also provide investor education and portfolio management.

If you still want to save brokerage and go with a reliable broker, you can also consider leading discount brokers like zerodha. But you wont be getting support like you get from a full service broker.

Some of the popular names in this category are IndiaInfoline (IIFL) , Sharekhan and ICICI Direct.

Final Thoughts about Best Demat Account in India:

 From the above, you might have understood that there isn’t a broker that fits all. All of them are good at different things. Some have low charges, some others have best trading platforms, some brokers provide high leverage while some have good customer support and all. So its upto us to select one broker as per our requirement. It all depends on our requirement.

So which broker is best for demat account in India?

Considering all these, as far as I am concerned, Zerodha provides best demat account in india. I have switched from Sharekhan to Zerodha in 2016 and using it till now along with Fyers.

Zerodha have some of the best and reliable trading platforms available in India for both investors and traders.

I have tried to select 3 top demat accounts for 2021 available in India for traders based on my experience. however do your own research before taking any decision.

Also don’t forget to check with respective brokers if there any changes in the brokerage structure compared to what I have mentioned here.

 

Please let me know if there is anything to be revised, please let me know through comments. Also mention why do you think so.

Based on my experience, I can say that Zerodha offers good demat account and can easily recommend them at any time.

Frequently Asked Questions (FAQs) About Best Demat Account :

Question 1.  Can I have multiple Demat Account? Is it legal to have more than 1 demat account in India?

Answer : Yes, it is completly legal in India to have more than one demat account. Howerver, all the demat account should be linked to your PAN number.

Question 2.  Can I have multiple Demat Account with a same stock broker?

Answer : No, Only one demat account per stock broker is allowed in India.

Question 3.  Can I Buy Shares without demat account?

Answer : No, now it is mandatory to have shares in dematerialized form, hence you can not buy share in physical form. So demat account is must if you want to puchase any shares.

Question 4.  Can I  transfer shares from one demat account to another?

Answer :  Yes, it is possible to transfer shares from one demat account to another. Read this post for the more details and steps.

Question 5. Which is the best demat account in India for beginners?

Answer : As far as I am concerned, it is Zerodha. It is has the trading platforms, best demat account for beginners with free stock market education (varsity) for newbies and zero brokerage charges for delivery segment.

Question 6. Who offers Free demat account in India?

Answer : Upstox and Fyers are offering demat account with zero account opening charges in the above given list. It is a short time offer and it can end anytime soon.

Question 7. Where can I compare the features of demat accounts?

Answer : You can visit any demat account comparision website like a digital blogger or chittorgarh to check side by side comparision of two demat account. And decide depending upon parameters such as:

• Best demat A/C for small investors
• Top demat account for IPO investments
• Best demat account for intraday trading
• Top demat A/C for options trading

Question 8. Which is the best 3 in 1 demat account?

Answer : 3-in-1 demat account is usually offered by the broker backed by a bank. 3 in 1 accounts offered by leading banks are best option among the. ICICI Direct and Kotak Securities are some of the well known names. Nowadays, Zerodha and Upstox have also started offering 3-in-1 demat account with tie up with IDFC First and INdus Ind bank.

Question 9. Which is the best demat account for traders in India?

Answer : For me its Zerodha, , supar fast & super light, clean User Interface(UI) is good choice for traders. Rs20/trade irrespective of traded amount and with the trust factor of being the biggest stock broker of India, Zerodha demat account is the best demat account in India for traders.