Holding Mutual Fund Units In Demat Form Offers Little Benefit

Opening a demat account is one of the primary steps towards investing in the stock market. Apart from investing in stocks, you can invest in mutual fund units through the demat account. Holding mutual fund units in demat form offers numerous benefits like you can get one consolidated view of all your holdings which helps you to track the performance and valuation of your holdings online. It involves great convenient as it is a paperless form of transaction which lets you redeem your funds anywhere and anytime. Moreover, it eases the process of nomination and transfer of securities.

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You can open a demat account online with Kotak Securities and avail numerous benefits like smooth trading experience, minimum paperwork, expert research recommendations, after market order service, mobile app for easy stock movement tracking, real-time market updates and much more.

Let us see in detail the benefits of holding mutual fund units in demat form.

Benefits of Purchasing Mutual Fund through Demat Account

With a demat account, you can hold mutual funds in the same account where you can purchase or sell shares. Thus, it gives the investor an option to purchase or sell mutual funds units online through the demat account and track all the capital market investments at one place.

The first and foremost benefit of demat account is paperless transaction. So when you purchase mutual funds via demat account, there is no paperwork involved. Purchase through demat account for mutual funds ensures that there is only a single statement for all the holdings in the capital market.

Another benefit of transacting mutual funds through demat account is that the units can be easily transferred to the account of the legal heirs or nominee. Tax savings funds can be transferred only after it completes a three-year lock-in period.

Demat account for mutual fund gives the benefit of making easy change in the information. As demat account is a consolidated platform, an investor can change his information with ease. There is no requirement for sending multiple requests to the various fund houses. Instead, a single application to update the information is enough.

An investor who trades in the stock market can purchase mutual funds too. He the advantage of trading in a demat account in the most efficient and cost-effective way.

Redemption of Mutual Funds through Demat Account

Redemption of mutual funds in the demat account can be done through depository or broker. All you need to do is send the redemption request form to the depository. After verification, the request shall be sent to the fund house and its Registrar and Transfer Agent (RTA). The money shall be paid to the broker’s pool by the fund house or the RTA and it would directly go into your bank account. The redemption process takes about 2-3 days.

Having a demat account for mutual funds is always a good option. It eases the process of tracking all investments at a single place. To avail its benefits and make the demat account a hassle-free experience, you can open an account with Kotak Securities.