Demat vs Trading Account: Are Demat account and Trading account different, what is the difference between the two?

If you invest in or are interested in the stock market, you likely use, or have heard of, a demat account and a trading account. At some point, the question must have crossed your mind: what's the difference between the two? New investors often mistake them for the same thing, but they actually serve different purposes. If you want to invest effectively in the stock market, it's crucial to understand the difference between these two accounts.

What is a Demat Account?
The function of a Demat Account is to keep your shares and securities safe. In the past, shares were available in paper form, but now everything is digital. Just as your money is kept safe in a bank account, the shares, bonds, or mutual fund units you purchase are held electronically in a demat account.

What is a Trading Account?
You can think of a trading account as the gateway to buying and selling shares. This means that whenever you buy shares, the order goes through your trading account. Similarly, when you sell shares, the money is transferred to your bank account, and the shares are deducted from your demat account and transferred to another account.

What's the difference between the two? (Demat Account vs Trading Account)
Your shares and securities are stored in a demat account, and you complete the buying and selling process in a trading account. Simply put, a trading account is a gateway to the market, while a demat account is like a locker where purchased shares are kept safe.

Both accounts are managed through the same app.
Both demat and trading accounts are managed through the same app. If you purchased shares today, they will appear in your trading account. However, if you purchased shares a day earlier or at an earlier time for a long-term consideration, they will appear in your holdings section.

Groww: In the Groww app, both accounts operate on the same platform. Stock trading, holdings checks, and mutual fund investments are possible with a single login.

Zerodha: Zerodha's Kite app integrates demat and trading accounts. You can buy and sell shares (trading) and view holdings (demat) with a single user ID and password.

Top 10 Brokerage Firms in the Country, Groww Number One
As of June 2025, Groww is the largest brokerage firm in the country, with 12.58 million active clients. Other big names like Nithin Kamath's Zerodha app and Angel One are also performing well on the list.

Number of Trading App Active Clients
1. Groww 125.80 lakh
2. Zerodha 75.85 lakh
3. Angel One 73.20 lakh
4. Upstox 25.71 lakh
5. Kotak 14.57 lakh
6. Motilal Oswal 9.97 lakh
7. Sharekhan 6.26 lakh
8. m.Stock 4.60 lakh
9. 5paisa 4.01 lakh
10. Axis Securities 3.98 lakh
If you are new to the stock market, you should have complete information about demat accounts and trading accounts.

Disclaimer: This content has been sourced and edited from Dainik Jagran. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.