SOA vs Demat: How Should You Hold Your Mutual Funds?

Mutual funds in India can be held in two ways — SOA (Statement of Account) or Demat mode.

In SOA mode, your mutual fund units are held directly with the AMC or RTA, and you do not need a Demat account. It also allows easy SIPs, switches, and redemptions, and usually does not involve Demat-related charges.

In Demat mode, units are held in your Demat account, similar to shares. This requires a broker and Demat account, and Demat or transaction charges may apply.

💡 It’s important to know that returns, NAV, and portfolio remain exactly the same in both modes. The difference is only in the holding and transaction process.

Many long-term investors commonly use SOA mode due to its flexibility and potentially lower costs.

Mutual Fund investments are subject to market risks. Read all scheme-related documents carefully.