Is Demat Account Required For Mutual Funds

1. Is Demat Account Required For Mutual Funds A Demat account also called as a dematerialised account, is an online account where you can save your investments in a digital form. It helps you to keep a record of different types of investments like mutual funds, bonds, stocks, etc in a single place. It is a very useful account but if you ask is Demat account required for mutual funds? Then, the answer will be no. If you want to invest in mutual funds, you can do it without having a demat account. The decision to hold mutual fund units in Demat mode is absolutely optional, except in respect of Exchange Traded Funds. For all the other schemes, including the close-ended listed schemes like Fixed Maturity Plans (FMPs), it is entirely up to the investor whether to hold the units in a Demat mode or in a conventional physical accountant statement mode. This online account is mandatory only when you are investing in stocks. Are there any advantages of having a demat account? Is demat account required for mutual funds? No. But are there any advantages to it? Yes. Check the below-mentioned points to know the advantages of a Demat account. 1. Digital library – All your investments are stored in one place digitally. You don’t have to look for securities and bonds at different places. You can easily overlook and manage your money and make other investments. 2. Safe and secured – Before the arrival of the Demat account, the shares were present on the paper certificate. But now, all the shares, documents or certificates are digitally saved. You don’t have to worry about the theft, forgery or misplacement of the documents as they are safe and secured electronically. 3. Smooth transfer – Having a Demat account will help you with a hassle- free transaction. You can easily buy or sell your shares and transfer the ownership to another person without the management of physical papers. This saves process saves you time and money. 4. Easy accessibility – You can easily access the account on your computer or smartphone anytime. You just need an internet connection and a smartphone. There is no need of searching the physical papers of the investments. 5. Auto-credited dividend – Early you did have to wait for a long time to receive the interest, dividend or refunds. But now because of the Demat account, the money is automatically credited to your account. Through the electronic clearing service (ECS), updating your account with stocks, bonuses, rights, splits, etc has also become easy and fast.

2. 6. Nominee –In case of an investor’s demise, the person who is appointed as the nominee will get the shares. The ownership of shares is quickly transferred to the nominee through the Demat account. 7. Share liquidity – The selling of shares has become fast and convenient because of the Demat account. The money is transferred quickly, upon selling your shares. 8. Loan on securities – If you have a Demat account, then you can take a loan against your shares. You can keep your securities as collateral and later pay off the loan to redeem the shares. For More Info You Can Visit Originally Published Aritcle Click Here