According to this article, there are there approaches to investing:
- Approach the fund houses directly and create an account
- Approach a brokerage firm and create an account
- Approach an independent entity and create an account
Although the article lists the advantages and disadvantages of each:
I am still a bit concerned about security in the last two approaches. If a person opens accounts in multiple fund houses, each account will have it's own password and PIN (which they can easily maintain and safeguard). But if a person uses a brokerage firm (like ICICI Direct) or an independent entity (like FundsIndia or FundsSupermart), won't it be easier for someone to hack into a person's ICICI Direct or FundsIndia account and steal money they've invested in all those funds of various fund houses?
The assumption here is that if the person approaches fund houses and open accounts with all of them, then a person's money might be safer, since it's not so easy for someone to hack into or forge signatures for so many accounts and get away with it. I'm asking this, because a friend tried opening an account with ICICI Direct, and he disagreed with some clause of the form and scratched it out and submitted it. On seeing the form the next time during the formalities, he noticed the line he scratched out was no longer there and somebody had forged his signature just so that the form would go through the account opening verification process without any hassles.
So in a world of money hungry people who are willing to forge signatures or hack accounts, is it really safer to opt for a single account which offers access to all fund houses or to open individual accounts in fund houses?