Be sure to review all aspects of the competitive landscape before opening your demat account. It is better you open your demat account with your broker as that makes the entire process much simpler. The big challenge of keeping your broker and DP separate is that the onus is on you to ensure that the debit instruction slip (DIS) in the event of sale of shares is delivered to the broker on time. If the demat account and the trading account are with at the same place, it solves a lot of hassles for you. It is important to review the costs. Costs of demat is not just about getting a free account opening. It is about the annual maintenance charge (AMC), debit costs for selling shares, other charges etc. If you are small investor with value of shares less than Rs.2 lakh then opt for the BSDA account which will be a lot more economical.