Question

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

• A. For holding and transferring securities in the Demat form
• B. For entering into an agreement with broker
• C. For making payment to stock exchange for any purchase of securities
• D. For enabling cash transactions in the securities market

Hint:

Break the word down: Demat means dematerialised, so the account exists to hold an electronic record of securities. Ask which of the listed jobs actually needs an electronic record of ownership, and which ones instead need cash movement or a broker agreement; those belong to different accounts entirely.

Answer 1

The Correct Option is A