Invest in direct mutual funds to
avoid agent commission..!
As you do not have an agent, you do not
have to pay a significant commission on your mutual fund investment, so your
expense ratio will be lower In a direct mutual fund plan, you can invest your
money in mutual funds through a fund house, without the involvement of a
distributor, broker or an agent.
As you do not have a distributor,
you do not have to pay a significant commission on your investment, so your
expense ratio will be lower.
For instance, SBI Bluechip Fund
regular plan has an expense ratio of 1.97%, whereas its direct mutual fund plan
has a much lower expense ratio of 1.15%, according to Value Research.
The net asset value (NAV) of a funds
direct plan will be higher compared to the regular plan.
The process..!
You can buy direct mutual funds
online as well as offline. There are multiple platforms to buy online.
For instance, you can visit the
individual asset management company’s website and fill in your details.
You can also invest via MF Utility,
an initiative of the mutual fund industry under the Association of Mutual Funds
in India (AMFI).
Another option is to invest through
websites such as Money Front and Bharosa Club.
In case you are looking to invest
through the offline channel, you will have to visit the fund house’s office.
For all mutual fund investments, you
need to do your know-your-customer process.
To opt for direct mutual fund
investments, either you should be financially aware of it, or you should get a
financial advisor to guide you.
To pick the right direct plan,
understand mutual fund schemes. If you think you can find time to keep track of
your mutual fund performance and are not willing to entrust your money with a
broker, consider it.
If you are not adept with it, you can
seek help of a financial advisor before investing in direct plans.
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