How to trace lost mutual fund investments?

I found the HDFC Equity Mutual Fund statement from my deceased father's documents file. He invested Rs 20,000 in 2008. How to track the current value, and what is the procedure to withdraw the money? - VS, Puttaparthi

HDFC Equity Fund launched more than 25 years ago, is one of the flagship funds of HDFC Asset Management Company. HDFC Equity Fund comes under an open-ended dynamic equity scheme investing across large-cap, mid-cap, small-cap stocks. The fund is categorized as a high-risk mutual fund. However, the mutual fund scheme's name has been changed from HDFC Equity Fund to HDFC Flexi Cap Fund. The latest net asset value (NAV) per unit is Rs. 1038.

The status of nomination and mode of holding is vital in the eventuality of the death of the primary holder of mutual funds. Usually, investments in mutual funds can be held either singly or jointly. Transactions such as the purchase of additional units, systematic withdrawal plan (SWP), Systematic Transfer Plan (STP), redemption and others, can be done by 'Either or Survivor' in the case of joint holding if the fund or folio was created under joint holding as per the application. As the case may be, the joint holder or nominee must submit an application to the fund house (AMC) for redemption or transfer of the mutual fund units to the beneficiary's account. Redemption of units from the fund mentioned above will be easier if the above fund is jointly held.

The redemption process will require minimal documents if there is a registered nominee in the case of a single holding. There could be multiple nominees as the Mutual Fund schemes make room for multiple nominees. All nominees will be assigned the percent of the total value as per the intent of the original deceased unit holder in the case of multiple nominees. The MF unitholders or portfolio holders can appoint up to three nominees in India. The MF unitholders are required to allocate a proportion that will go to each nominee in case of the unit holder's death.

This means the percentage of the total value of mutual fund investment that the holder wants to distribute to nominees in case of the holders' death. In the scenario that there is no nominee or joint holder, the AMC or fund house requires a prescribed application supported by various legal documents by the legal heirs of the deceased unit holder. The requirement for additional documents arises if the total value of the mutual fund units or the transmission amount is more than Rs two lakhs. Otherwise, you may be required to submit the death certificate, succession certificate, Indemnity Bond, KYC of legal heirs or claimants.

I have a demat account with ICICI Bank and a trading account with ICICIDirect. Can I open another demat account and a trading account with another broker without closing the existing account? Is there any restriction on the number of demat accounts? GB Tilak, Bhubaneswar

There are no restrictions on the number of demat accounts that can be opened or operated by an Indian investor. Any individual investor is permitted to open multiple demat accounts, provided with different Depository Participants (DP). A depository participant is a registered broker, brokerage firm or agent of a depository. Typically, scheduled commercial banks, financial institutions and brokerage firms act as depository participants. In your case, ICICI Bank is your existing depository participant.

You cannot operate multiple demat accounts with ICICI Bank. However, you can open a second demat account with a XYZ depository participant and a third Demat account with a PQR depository participant. Please be informed that some depository participants levy various charges on the demat account. Therefore, you will end up paying the annual maintenance charges on every demat account you operate, whether you made transactions or not.

You may open and operate multiple demat accounts as long as there are no annual charges and other levies. Sometimes, having numerous demat accounts will incur additional costs. Having more than one demat account may lead to confusion and cause you to make mistakes while trading. Nevertheless, investors, especially millennials, continue to operate multiple demat accounts. Various depository participants or brokerage firms offer attractive no-frill accounts and deals on what makes millennials tick.

There are certain benefits of having numerous demat Accounts. The majority of investors are opening more than one demat account to segregate investment asset classes to separate trading from investments and differentiate between long-term and short term investments. Another convenience with multiple accounts is that investors may enjoy various unique features offered by different depository participants.

(The author is a SEBI licensed Research Analyst. The alumnus of the Indian Institute of Foreign Trade (IIFT), he had held leadership roles at National Geographic, Reliance Radio Television Luxembourg, STAR TV, etc)