Investment in stock market securities helps investors earn substantial returns over traditional investments like fixed deposits. Mutual funds, ETFs, commodities, shares, and various other types of securities are listed that investors can invest based on their preferences and risk-taking capacity. Out of all the investment options, mutual funds and a systematic investment plan can help investors amass much wealth over a significant period. However, investors required proper tracking, and management of their systematic investment plans to make the process hassle-free and transparent. A demat account therefore serves as a great tool that is essential for investment and can help with simplified SIP management.
What is a demat account?
A demat account serves as a reliable digital platform that makes the process of investment into stock market securities convenient. Investors can invest in securities available in electronic/dematerialized format using a demat account. Moreover, all the investments can be managed using a single platform thereby making the process of investment, management, and tracking transparent.
How does a demat account help with the management of mutual fund SIPs?
- Access to investments
Investors through a mutual fund SIP calculator can identify the amount of monthly investment and the total returns they can generate from mutual fund investment. Combining a demat account and a SIP calculator, investors can make the process of managing their systematic investment plans and other investments hassle-free. Different mutual fund schemes can be managed, tracked, and evaluated thereby helping investors immensely.
- Hasslefree buying and selling
Apart from the management of SIPs, a demat account can even help investors in buying as well as selling mutual fund units through a single platform. One can easily track the NAV of different mutual fund schemes for hassle-free investments. Moreover, one can easily switch between different mutual fund schemes seamlessly through a demat account. Any modification in the mutual fund scheme investment, SIP amount, and their redemption can be made through the demat account.
- Transparency
A demat account even offers easy access to all the investments, they are dedicated investment reports, current holdings, and even records of investments. With complete transparency, investors can make sound decisions regarding investments and redemptions thereby improving the chances of earning better returns through systematic investments in mutual fund schemes.
- Paperless form of investment
Investors through a demat account can even opt for paperless investment into different mutual fund schemes. Apart from buying, investors can even sell and transfer the redemption amount to their bank accounts without worrying about any paperwork or permissions from an institution.
- Automatic deduction of SIP amount
Investors even received the flexibility to link their demat accounts with their official bank accounts. Upon placing a SIP order, the monthly installment of investment is deducted automatically. Moreover, investors can set a fixed date for SIP installment deduction using their Demat account thereby helping in saving time and effort.
ConclusionÂ
Investors can easily open demat account through an online paperless KYC compliance process and start their SIP journey without any kind of hassle or inconvenience. With complete transparency, investors can handle their systematic investment plans, track their investments, and get access to all the necessary information through their demat accounts.
