InvestorQ : Is it compulsory to dematerialize and if so what can I dematerialize?
Dia Deshpande made post

Is it compulsory to dematerialize and if so what can I dematerialize?

Answer
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2 years ago


According to the Depositories Act, 1996, an investor has the option to hold securities either in physical or electronic form. Part of holding can be in physical form and part in demat form. However, SEBI has notified that settlement of market trades in listed securities should take place only in the demat mode.
What type of instruments is available for demat at Depository? That is an interesting question. You can not only hold equities but you can hold a variety of different securities in your demat account. All types of equity/ debt instruments viz. equity shares, preference Shares, partly paid shares, bonds, debentures, commercial papers, certificates of deposit, government securities (G-SEC) etc. irrespective of whether these instruments are listed / unlisted / privately placed can be dematerialized with depository, if they have been admitted with the depository. That is the only condition that they must be admitted with the depository. You can also hold mutual funds in your depository account and also gold bonds issued by the RBI in the same demat account including gold ETFs and index ETFs.