Can I close the Demat account without closing the trading account?

Technically, yes, you can close the Demat account without closing your trading account because Demat and Trading account are two separate things.

The Demat account is maintained by the depositories (e.g., CDSL and NDSL), and hold the shares in electronic format, whereas a Trading account is maintained by the depository participant (e.g., ATS) which holds money and helps you buy and sell these shares.

But, you should not close your demat without closing your trading account for the following reasons:

● Equity intraday position has to be settled to the demat account if they are not closed by the end of the day. For example, you bought Tata Motors share and the stock price hit the upper circuit. In that case, there will be no demat account to settle the trade.

● All stocks under the F&O contract are settled in the demat account itself. For example, if you want to take delivery of shares on the date of expiry of the contract. In that case, there will be no demat account to settle the trade.

DO YOU KNOW?

● If you already have a Demat account, you can just open a trading account with your broker and link the existing demat account with it.👍