ET in the Classroom: Different methods of holding your mutual fund units

economictimes.indiatimes.com:

investors started investing in mutual funds over the last one year, taking the total number of unique mutual fund investors up to 46 million. Many more investors are likely to buy mutual funds in the coming months. Investors have an option to buy and hold their mutual fund units in their demat account or they can buy units from the fund house which does not require any demat account.

HOW DO YOU BUY MUTUAL FUND SCHEMES? WHAT IS THE WAY TO HOLD THEM?
Once you have chosen a mutual fund scheme to buy, the next step is to proceed to buy these units and execute your transaction. There are a number of ways to buy mutual funds, be it the fund house websites, RTA (registrar and transfer agent) websites, third-party platforms and stock brokers. Investors can opt for a statement of holding, or certain brokerages give you the option to hold units in a demat form. Some brokers only offer MFs in a demat form, while a few offer a mix of the two. Depending on the comfort and ease of an investor one can choose between the two. Investors who buy units in the physical form can later convert them into a demat form, by submitting a request to the depository participant and units bought in demat form can also be rematerialised back again.

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IS THERE ANY ADVANTAGE OF BUYING MUTUAL FUNDS IN A DEMAT FORM? Distributors believe one big advantage of buying MF units in a demat form is that you can get a consolidated view of your investments