Buying shares involves three accounts: your bank account, a trading account with a stockbroker, and a demat account where the shares are held electronically.
Who does what#
- Stock exchanges (NSE and BSE) match buy and sell orders.
- A SEBI-registered stockbroker places orders on the exchange for you.
- Depositories (NSDL and CDSL) hold shares in electronic form.
- A depository participant, often your broker, opens and services your demat account.
What happens when you buy#
- You place an order through your broker's app or website.
- The exchange matches it with a seller.
- After settlement, the shares are credited to your demat account and the money is debited.