Before the internet took over our lives there was something called physical shares which are the paper form of today’s demat shares traded on a stock exchange.
If you stumble across any of these shares today they might be worth a fortune. Probably because your grandfather or great-grandfather might have bought them ages ago and forgotten to convert them into demat.
If you’re lucky these physical shares could belong to companies whose price has risen drastically over the years. (But they could also be shares of companies who might have shut down!)
Whatever be the case if you have them, convert them ASAP. Here’s why:
#1. Currently, you cannot trade physical shares:
Physical share certificates were in vogue before Demat came into existence and they would be traded in a system popularly called as the open outcry system. (Remember that scene from the movie Guru where everyone was shouting in a marketplace to sell their shares).
They were the only proof one had of owning shares of a company. But after Demat was mandated in 2011 trading of physical shares on the stock exchanges stopped. The only way these can be transferred now is through private deals.
#2. Demat makes trading super easy and convenient :
Imagine the two situations
THEN: Earlier people actually had to shout out their selling price in a market. This was called the open outcry system. Because of this, the number of traders was very few.
NOW: Today just by sitting at home you can type in your selling & buying price on an electronic platform and trade easily. And because of this more people have started trading which has increased prices and stock markets in India have become a big thing.
Demat has made shares accessible from any place eliminating the risks of fake securities, theft, etc. And ensured that sellers get their money and buyers get their shares on time.
#3. Helps in investing in various asset classes:
A demat account gives opportunities to invest in other asset classes like gold ETFs and commodity futures as well.
#4. Directly credits your account with co-operate benefits:
With Demat account all non-cash benefits like rights and bonus shares directly get credited to your account, ensuring faster disbursement and also leading to a reduction in brokerage cost.
So if you haven’t already converted them go get it done NOW.
The procedure is not that simple (But its worth it):
If you face any difficulties while doing this, email us with your problems and we will guide you.