[huntrz]

Originally Posted by cncmachinist

Hello

I have started my investment journey long back with a HDFC securities account linked to my HDFC bank personal account. My DMAT account is with NSDL. Two years ago I opened second account with Zerodha with DMAT account in CDSL. I find managing Zerodha account is far easier and cheaper than HDFC one.

Questions are
1) How do I transfer all my holding in NSDL to CDSL and close HDFC Securities account?.
2) Has any one done this and can guide me in doing this?
3) Can this be done online?

In both accounts I am the sole holder.

I would suggest keep HDFC securities account. Its a part of very large and respected group. You may not share the same opinion but i feel an expensive full service broker is more reliable than a discount broker. I have been skeptical of all free platforms since long. Groww fiasco just cemented my conviction. You may use your HDFC securities account for liquid funds and long term equity holdings as equity will only attract one time brokerage and liquid funds are anyway not for investment.

It is always good to have diversification with respect to your broker. So that if something goes wrong with one broker(like Paytm, groww etc) your entire invesment isn't at risk. After all when we invest for long term we should expect our brokers too to stay in the business for that long. Theoritically nothing can go wrong but then scams like the one in Groww or regulatory issues as in Paytm comes out. 10 years back lots of free platforms were there. Don't know where most of them are today and how profitable they are. But the big and profitable players survived anyway.

[SmartCat]

Originally Posted by huntrz

I would suggest keep HDFC securities account. Its a part of very large and respected group. It is always good to have diversification with respect to your broker.

Good advice regarding multiple brokers.

So that if something goes wrong with one broker(like Paytm, groww etc) your entire invesment isn't at risk

However, this is not accurate. Your shares are held with CDSL or NSDL. Not the broker. If a broker goes down, only the cash balance with the broker is at risk.

10 years back lots of free platforms were there. Don't know where most of them are today and how profitable they are. But the big and profitable players survived anyway.

Zerodha is on a different level altogether compared to other riff raff. Despite 'discount broker' or 'zero brokerage' tag, it is the most profitable stock broker in India. In FY23, Zerodha made a profit of Rs. 2,900 cr on revenues of Rs. 6,500 cr
https://economictimes.indiatimes.com.../103958769.cms

[huntrz]

Originally Posted by SmartCat

However, this is not accurate. Your shares are held with CDSL or NSDL. Not the broker. If a broker goes down, only the cash balance with the broker is at risk.

I knew this was coming. There are a lot of things that can ruin one's sleep. Technically everything is held with CDSL or NSDL but how many of us reconcile the holdings, particularly if the volumes of your buy/sell are high. Aquisitions, bans etc create short term uncertainilty and some times loss of liquidity for the client. There are literally hundreds of ways things can go wrong. As was the case with one of the brokers where they didn't execute the transaction but updated the portfolio, which was found out only when the client went to redeem. CDSL and NSDL didn't even come into picture.

Originally Posted by SmartCat

Zerodha is on a different level altogether compared to other riff raff. Despite 'discount broker' or 'zero brokerage' tag, it is the most profitable stock broker in India. In FY23, Zerodha made a profit of Rs. 2,900 cr on revenues of Rs. 6,500 cr

True. Zerodha has been profitable. Hence the compulsion to make money through unscrupluous means doesn't apply to them. They are a lot safer. There are many startups though offering everything for free, burning VC money hoping to make money by selling allied services. No one knows when are they going to go belly up. Zerodha won't go bust. They may get aquired though which is not a bad thing but will create temporary uncertaininty.

[SmartCat]

Originally Posted by huntrz

There are a lot of things that can ruin one's sleep. Technically everything is held with CDSL or NSDL but how many of us reconcile the holdings, particularly if the volumes of your buy/sell are high.

NSDL/CDSL should be sending your stocks and mutual funds holdings statement (called CAS or Consolidated Account Statement) in password protected PDF file every month. It does not matter if your broker uses NSDL or CDSL. Or if you have multiple brokers. You will get one PDF file, with all the holdings details. If you are not getting it, follow these instructions:
https://support.zerodha.com/category...es/what-is-cas

As was the case with one of the brokers where they didn't execute the transaction but updated the portfolio, which was found out only when the client went to redeem.

Groww has issued clarification. Here, I'd trust Groww rather than some random guy complaining on twitter
https://economictimes.indiatimes.com.../111425457.cms

[huntrz]

Originally Posted by SmartCat

NSDL/CDSL should be sending your stocks and mutual funds holdings statement (called CAS or Consolidated Account Statement) in password protected PDF file every month. It does not matter if your broker uses NSDL or CDSL.

I am aware but I don't usually look into it if I trust the broker.

Originally Posted by SmartCat

Groww has issued clarification. Here, I'd trust Groww rather than some random guy complaining on twitter

To each his own. Its on us to choose wisely.
A 2020 invesment with proven fake folio number generated!! and refunded in 2024 "on good faith basis" is not exactly my idea of trustworthyness. A customer has no way to know whether folio number shown is for a different but valid transaction or a ficticious number. Typically users can have have multiple folio numbers with each fund house even with same broker. Either way it shouldn't appear on their portfolio. The user also hasn't supported Groww's story and just said that correct amount has been refunded. When there was no debit then what was the resolution and refund for? Its clear how the customer has been made to write the reconciliatory post. Random guys don't usually have the time and resources to fight it out. From Satyam to Kingfisher to Paytm, no company in India has ever admitted that they have messed up. They always issue a carefully worded statement which would imply there is nothing wrong and its business as usual.

[saket77]

Originally Posted by SmartCat

Groww has issued clarification. Here, I'd trust Groww rather than some random guy complaining on twitter
https://economictimes.indiatimes.com.../111425457.cms

Originally Posted by huntrz

I am aware but I don't usually look into it if I trust the broker.

To each his own. Its on us to choose wisely.

The transactions in these apps are updated through a reverse feed transaction file generated by the RTA (CAMS & KFIN tech) which are imported into these record keeping softwares maintained by various distributors and intermediaries on a daily basis. None of these apps are 'manually' updated. Having seen this system from close quarters, I can tell that these reverse feeds by RTAs , even today, are far from being perfect. Sometimes even the transactions are missing. I am sure the Grow issue was a result of this inconsistency on the RTA's part.
Yes, reconciliation of this data with RTA at a later date would have highlighted this discrepancy and this is where Grow missed it. Apart from that, there is no way that this was a intended fraud. Not siding with any intermediary; just providing a technical explanation of what would have happened in this case.

Thanks.

[NetfreakBombay]

Originally Posted by SmartCat

Groww has issued clarification. Here, I'd trust Groww rather than some random guy complaining on twitter
https://economictimes.indiatimes.com.../111425457.cms

Like most corporate PR statement, it glosses over the core issue.

1. Groww's systems or processes incorerctly processed transactions
2. When user reported the issue, it took way too long for a reasonable reply (only actioned after social media pressure)

When we processed this file, the customer's original instalment, dated September 25, 2020, got inadvertently updated to a value of Rs. 50,000/-. This resulted in an increased invested value and units shown to the customer
...
The customer was seeing a different entry which was folio details of another transaction. This folio did not belong to that customer. There was no debit from the customer's account. When the issue was flagged to us, we reconciled the entry, found the issue with the duplicate Order ID handling and revised the customer's folio.

[SmartCat]

We need to separate technical glitches from 'scams'. Even with full service bank brokers, issues have cropped up over the past 2 decades. Some cases even go to the SEBI level (because it is brokers responsibilty to ensure no glitches happen) before getting resolved.

It doesn't make sense for Groww founders to steal from customers. It is far easier/simpler to steal from private equity investors, who have pumped in $250 million last year
https://groww.in/blog/groww-raises-2...d-its-business

[huntrz]

Originally Posted by saket77

Having seen this system from close quarters, I can tell that these reverse feeds by RTAs , even today, are far from being perfect. Sometimes even the transactions are missing. I am sure the Grow issue was a result of this inconsistency on the RTA's part.

Thanks for sharing the insights. I also have a icicidirect account. They are expensive as hell. No direct MF. From my personal experience I can say one thing that these reconciliations and followups are done very diligently by them. I feel that they can be trusted eyes closed. They notify about any discrepancy or delay for each transaction be it share or mutual funds, via a separate notification. On the other hand upon encountering a similar delay in a MF transaction in my wife's broking account by SBI securities(they offered free MF transactions at that time), their customer care handed me the registrar's office phone number to follow it up myself . IMO this is where a profitable and well paid broker matters.

[NetfreakBombay]

Originally Posted by SmartCat

We need to separate technical glitches from 'scams'. ...It doesn't make sense for Groww founders to steal from customers.

+1, it is not a scam

Customer got what they were looking for (Social media pressure and thus a resolution). Calling it a scam made it happen.

System issues can happen, but but customer care's incompetence created this mess.

Originally Posted by huntrz

They are expensive as hell....

Unfortunately that is pretty much the choice we have as customers..

Either use a discount broker and expect some issues but better user experience OR deal with bad Apps and cost of other brokers. Good thing is, cost have come down to 0.3% or lower as compared to 1.5% they used to charge.

[SmartCat]

Originally Posted by huntrz

I also have a icicidirect account. They are expensive as hell.

It's not too bad, especially with the launch of new brokerage plans. I'm paying just 0.15% for equity delivery, but it can go as low as 0.07% with other plans. Investing in mutual funds (regular plans) via ICICIDirect doesn't make any sense though.

Originally Posted by NetfreakBombay

Unfortunately that is pretty much the choice we have as customers

www.mstock.com offers a balance between reputation & cost. It is owned by Mirae Asset. I opened a brokerage account for my wife a couple of years back and so far, no issues.

[DigitalOne]

Originally Posted by huntrz

I also have a icicidirect account. They are expensive as hell. No direct MF.

There used to be a time when regular MF used to make sense (consolidated portfolio statements, single point of transaction across AMC etc) but no more. With portals/apps like MFCentral, MFUtilities (haven't used it personally), and monthly NSDL CAS statements etc, it is very easy to go Direct and save considerable amount of money. I use MFCentral extensively to manage a portfolio of around 2cr across 8 AMCs, all Direct.

For a MF portfolio of 1Cr, a 1% difference in fees means a recurring saving/additional investment of 1 Lakh per year.

[saket77]

Originally Posted by DigitalOne

There used to be a time when regular MF used to make sense (consolidated portfolio statements, single point of transaction across AMC etc) but no more. With portals/apps like MFCentral, MFUtilities (haven't used it personally), and monthly NSDL CAS statements etc, it is very easy to go Direct and save considerable amount of money. I use MFCentral extensively to manage a portfolio of around 2cr across 8 AMCs, all Direct.

For a MF portfolio of 1Cr, a 1% difference in fees means a recurring saving/additional investment of 1 Lakh per year.

Yes, but this should strictly apply to financially literate investors & families who are good enough to manage their portfolios so that their investments fulfill their goals.

I will happily pay 0.6% to 0.8% commission per annum to a pro-active distributor who can help me generate much more returns by his expertise in better fund selection than the commission he might receive by those funds. Also, I am presently witnessing a case in family where after a relative's demise, the distributor is helping the deceased person's wife to claim the investments who herself is a very simple lady and doesn't understand much of finance and all. So, the distributor model cannot be sidelined only because direct transaction platforms are available if you see value in their service.

[huntrz]

Originally Posted by SmartCat

It's not too bad, especially with the launch of new brokerage plans. I'm paying just 0.15% for equity delivery, but it can go as low as 0.07% with other plans. Investing in mutual funds (regular plans) via ICICIDirect doesn't make any sense though.

Yes talking about regular plans. They used to charge flat 30 Rs transaction fee for lumpsum investments despite the trail comission!! Thats when I stopped investing in MF through them. No charge for liquid funds though. Not sure if they have mended their ways now. but they will never offer direct MFs. Its their bread and butter.
They have a hefty Annual platform charge plus annual rental for the low brokerage plans. Prime plan rental itself is equal to zerodha's annual platform charge.

Originally Posted by saket77

Also, I am presently witnessing a case in family where after a relative's demise, the distributor is helping the deceased person's wife to claim the investments who herself is a very simple lady and doesn't understand much of finance and all. So, the distributor model cannot be sidelined only because direct transaction platforms are available if you see value in their service.

Grossly overlooked scenario. Dealing with multiple fundhouses/organizations/channels individually and having multiple invesitng platforms make the post demise scenario very complex and cumbersome. I have experienced it. Family members maynot even be aware of the number of places the money has been invested in. Expect no support from free/no frill platforms.

[DigitalOne]

Originally Posted by saket77

I will happily pay 0.6% to 0.8% commission per annum to a pro-active distributor who can help me generate much more returns by his expertise in better fund selection than the commission he might receive by those funds. Also, I am presently witnessing a case in family where after a relative's demise, the distributor is helping the deceased person's wife to claim the investments...

Originally Posted by huntrz

Grossly overlooked scenario....Expect no support from free/no frill platforms.

"Pro-active" distributor is the key word here. Please don't expect any support from faceless, large institutions like ICICIDirect or HDFC Securities in these critical situations. Their customer service functions are being rapidly replaced by AI chatbots/voices.

RMs are good only for doing sales. Recently, I opened an ICICIDirect Global Invest account (ICICIDirect's offering where you can hold foreign equity directly) and tried to transfer my employee shares (Frankfurt listed company) to this account. Some details were required to add this brokerage account to my employee brokerage account. The RM was of no help, email queries went unanswered, and a ticket is still open . I could not do the transfer, and the shares got automatically sold. So, no financial loss for me (except taxes this year).

We have to prepare our families/dependents to tackle this e.g. having a document on how to check MFCentral/CAS statement or other investments. I have a printout of such a document which we keep it in a safe place. But don't expect support, just because you are buying regular MFs.