Can I Join Coin-Direct MF without opening a Demat Account with Zerodha?

Zerodha Coin - Direct MF
1

Hi There,
I already have a Zerodha account for Equity investment on my Mother’s name/PAN.
My mutual fund investment is with a separate wealth management company who has all the features for MF investment and tacking, except Direct MF investment. So, is it possible to open my MF account in Coin-Direct MF without opening a Demat account ,which will not be used at all for Equity and thus saving the AMC of Rs 300?

Thanks

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2

Dear Sir,
I have trading account with Zerodha and my ICICI bank Demat account is linked with this trading account. Delivery based equity purchase are credited to ICICI bank demat account. Similarly if I join COIN, will Direct scheme MF purchases be credited to my ICICI bank Demat account?
If yes, my next query is how do i redeem them?
Regards
Prakash Joshi
DP0989

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3

All MF units in Zerodha are held in demat, so it is not possible to invest in MFs without opening a demat account with us. Compared to the commissions you are paying on your regular MF investments the AMC won’t be a big cost component.

For ex. on a SIP of ₹5000 / month over 25 years your corpus will be ₹1.36 Cr in a regular mutual fund compared to ₹1.64 Cr under a direct mutual fund. That’s a massive difference of ₹ 28 lacs. For the same period, the AMC charges will be just ₹ 7500.
If you do decide in invest in stocks, bonds etc you will have the convenience of managing them from one place.

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4

To buy mutual funds on Coin, you need to have your demat account with Zerodha. The advantage is you will be that you can manage all your stocks, MFs from a single place.
I would suggest you open a new demat a/c with Zerodha and move your holdings from ICICI if need be.

5

Hi, I still don’t understand the requirement of opening a demat account with Zerodha.
Let’s say, I have a trading account with Zerodha and my ICICI bank Demat Account is linked to this account. Now when I buy Equities they will be credited to my ICICI demat account. As these equities are with ICICI demat account and Zerodha doesn’t have POA over this demat account, I won’t be able to sell those equities through Zerodha.

Similarly, if I join COIN, will Direct scheme MF purchases should be credited to my ICICI bank Demat account provided I won’t be redeeming them Zerodha.

6

I want to invest in mutual funds but keep my expenses low. From what i understand without doing any purchase on the COIN platform, i would still have to pay 300/- anually for the Demat account maintainence. Can i close the demat account and still be able to purchase Mutual Funds via COIN?

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All MF units in Zerodha are held in demat, so it is not possible to invest in MFs without opening a demat account with us. Compared to the commissions you are paying on your regular MF investments the AMC won’t be a big cost component.

8

Thanks for the reply Bhuvanesh. One follow question - If i were to buy a direct plan from the AMC or MFU, won’t i be saving on the overall costs compared to Zerodha? So what benefit i get for using Zerodha Coin platform for my basic usage? Plus there will be the 50/- per month charges for investing beyond 25K. So every year i would be spending 900/- from my pocket to avail the same benefits on Zerodha as with an AMC directly?

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Saurabh, I believe one significant value is that using Coin, you can buy MF’s from multiple AMC’s with a single login.