Understanding the Differences between Demat Account and Trading Account Here is a look at the difference between demat account and trading account Demat Accoun t Trading Account Functions Demat Account allows you to keep securities like shares in an electronic format Trading Account helps you to engage in trading through this account. In other words, you can purchase or sell securities through your trading account. Nature A Demat Account is quite similar to a savings bank account, where you store securities in an elec tronic format. The number of shares sold or purchased gets reflected in your account, similar to the debit and credit functions of your savings account. A Trading Account, on the other hand, is quite similar to your current bank account. By linking your De mat Account with your bank account, it allows you to trade in shares. Roles Demat Account is simply an electronic repository of your securities. This account reflects your existing wealth in the form of securities in hand, or stock. Trading Account enable s you to trade in the securities, which will then be reflected back in your Demat Account. This account essentially represents a series of trading transactions like a flow Measurement of time A Demat Account, being your stock in hand, is measured at a poi nt of time. Usually, the stock is measured at the end of each financial year, or on March 31. As a Trading Account shows a series of trading transactions, it is measured over a period of time. For instance, trading for a month, or a year, or a fortnight.