Recently, when I wrote blog posts like “Top 10 Best Mutual Funds to invest in India for 2015” and “How to invest in Mutual Funds in India online?“, I found too many quarries asking me whether online mutual fund investment in India is really a DIRECT investment?
Before proceeding further, let me share a video shared by Mr. Srikanth Shankar Matrubai on one Whatsapp advisory group. This video was created by another fellow adviser, Mr. Ramesh Bhat.
In this video, you notice that www.moneycontrol.com reflecting the direct plans. Once you click on “Invest online” tab, and then DIRECT will disappear. In that place normal plan with money control ARN will be available on individual mutual fund company online purchase site. If you do not notice this then there is a high probability that you end up in buying normal plans than direct plans.
I am not stating that moneycontrol is doing anything wrong. However, highlighting the fund name of DIRECT but redirecting the visitors to normal plans is completely misguiding.
Next comes the online portals. These days, even a small adviser offers you online mutual fund buying platform from his site. So buying online with these online portals will not be DIRECT option. Instead, it will be normal funds only. Whether this online platform is your demat account provider, banks, some online portals, few advisory firms or an individual.
Please keep in mind that except mutual fund companies NONE of the intermediaries selling you DIRECT plans. Therefore, to earn the benefit of DIRECT plans, you have only option is to invest through mutual fund companies directly. If someone is offering you online platform, then you must keep in mind that it is not DIRECT plan, but a regular plan where he earns trail and upfront commission on your investment.
This is not the case with mutual funds alone. You find few insurance brokers, aggregators (a site that compares your insurance need and select a product for you) and few financial planners also who really push online term insurance of the particular company ONLY. You feel that you are buying online, but there again, these intermediaries earning commission on that. So never ever, heed if someone tries to push you any particular product. Whether he is fee based financial planner or fee only financial planner.
Buying ONLINE or DIRECT option is not so worry free or cost effective. The risks are there at every stage. So be cautious while buying mutual funds in DIRECT mode or life insurance through online mode.
Hope this update will clear your doubts about online buying of mutual funds and a small caution about online term insurance buying 🙂
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i am deivendran
1)how direct mutual funt,
2) i invest 20 years
3)how select funts
Deivendran-Refer "Top 10 Best SIP Mutual Funds to invest in India in 2017".
Invezta is a direct mutual fund online investing portal. Free till Rs. 50,000/- investments. The below code helps you to get Rs. 75,000/- investment limit. If you are a beginner you can use the service as there are no opening charges, excellent interface besides “Direct” mutual fund investments.
Coupon Code: 55C648
Apply the above code while you register to get the investment limit of Rs. 75,000/- plus all features for free of cost.
Honest Disclaimer: I received the above code when I registered. I get Rs. 25,000/- additional limit every time an investment is made through the code above. You will also receive a similar code upon registering and making first investment.
Akki-I already wrote a post on this "Invezta.com: Invest in DIRECT Mutual Fund schemes online at one place".
Halo sir, Am planning to open a flexi Rd as i am not sure about my goals. I might need an amount after 3 years , could I withdraw money after 3years and continue in a10 year scheme.
Deepak-Your goal is 3 years or 10 years?
Sir, it's 10 years.
Deepak-Then why you mentioned as 3 years also?
Sir, I wanna know that if i want to purchase sbi pharma fund in Sip in direct plan then shall i go to purchase this fund in sbi mutual fund house personally and do my kyc update?If not then plz tell me the procedure for direct investment.Ur article is very helpful to us.Thanks for your valuable advice.
Asad-There are many ways to buy direct funds. Few of them are directly visiting AMC, KAMS or Carvy, MF Utility and portals like Investza.
Dear Sir,
Good Morning!
I am existing MF investor in HDFC Midcap Opportunities Fund - regular plan with growth option and I have invested through HDFC bank. I am investing Rs. 3000/- as SIP in this fund every month from past 8 months. I have folio number and I HPIN through which I am able to see and track my folio online.
I know I have option to SWITCH from current regular plan to direct plan. Suppose now I switch from Regular plan to direct plan of same scheme would my further/future SIPs of this scheme and same folio would be treated as Direct Investments or same regular plan SIPs?
Thank you Sir.
Devaraj-Yes, under same folio you can invest in direct as well as regular funds.
Sir, I would like to know that if I invest in mutual funds through my demat a/c i.e, Sharekhan, whether folio number will be generated or not, and if yes, then whether this folio number can be used for buying mutual funds in direct plans
Ranjit-Yes, once you invest through your demat account then folio number will be generated. Using this folio number you can invest in DIRECT funds of that PARITUCLAR AMC. Because folio number is mutual fund company specific.
CAMSOnline is an RTA where MF investors can transact through desktop. Whereas, their myCAMS app can be used not only to create a folio but also used for Mutual Fund transactions like purchase, redeem, switch and much more through myCAMS!
Is MYCAMS a DIRECT platform?
Fahd-Using MYCAMS you can invest under the schemes of the mutual funds for whom they act as R&T Agents.
Sir I want to invest in tax saving elss schemes. Can I apply them online with direct option?
Rajesh-YES.
Mr.Basavaraj
Recently I have registered for KYC on fundsindia but I, didn`t get CAN. To invest CAN is must is it not?.
But the adviser asked me to invest in few MF as per my appetite.
They also told that their service is absolutely free of cost. I am confused in what way their service free, is it possible.
Rajashekhar-CAN is required to invest in MF Utility Platform. Their service is free, but they earn commission every time you invest. It is not a direct mutual fund platform.