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Best Online Platforms for Direct Mutual Fund Investments in India

best-direct-mutual-fund-platforms-india

With the financialisation of savings, mutual funds have become a popular investment instrument. Money from bank fixed deposits has started moving towards mutual funds. Some of the credit must go to Mutual Funds Sahi Hai Campaign by AMFI, which has enabled widespread awareness regarding Mutual funds among the investor community. Credit also needs to go to SEBI for easing the KYC norms.


Why Direct Mutual Funds are growing in popularity?


The difference is the Expense Ratio. The expense ratio of an asset fund is the total percentage of fund assets used for administrative, management, advertising, and all other expenses. An expense ratio of 1% per annum means that each year 1% of the fund's total assets will be used to cover expenses.

Regular Mutual Funds have a higher expense ratio than direct counterparts. The reason is they need to factor in the distributor commission, which is slowly & steadily collected as part of the daily returns. As an investor you don't need to worry about paying the commission amount, the AMC takes care of the same. Let's study the below fund snapshot as on 11th June, 2018. Focus on the highlighted areas. Source : Value Research Online


reliance small cap fund regular









reliance small cap fund direct










Clearly, the Expense ratio of a regular plan is 1% more than the direct plan. This is the commission to be paid to the distributor by AMC. 
The daily change for a regular plan as on 11th June, 2018 is 0.71%, whereas for the direct fund it is 0.72%. This is exactly how slowly & steadily the 1% commission is extracted from your daily returns.
For investor's who believe in Do-It-Yourself style of investing, nothing better than direct funds. 

Which platforms should i use to invest into direct plans?

Great!!Now you understand the impact of direct funds on your investment returns. The next big decision you need to take is to identify the platform which is easy to setup, easy to operate, flexible & provides detailed day to day reporting and analysis on your investments. Before registering on these platforms, investors need to ensure they are KYC or e-KYC compliant.

There are multiple platforms available for investment into direct funds. Some of these operate on a flat fee per transaction, some charge a monthly fee & few of them are completely free. Let's look into the best available options -


Directly through Mutual Fund Website - Investors can choose to register on the AMC (Asset Management Company) website. You can directly fill the form to select your mutual fund plan, investment amount, frequency and other details. You need to select the mode of investment as DIRECT instead of specifying the distributor code. It is advisable to always diversify your investments across different fund houses & for the same reason you will need to maintain multiple accounts across websites to manage your investments. Although, it is an ideal way to invest but getting a 360 degree view of your investments is a difficult task.


Mutual Fund Utility - All fund houses have come together to create a direct mutual fund investment platform called as MFU. You need to create a Common Account Number (CAN), which can be used for investment across all fund house to invest into Direct Mutual Funds. There is no additional fee levied on the investments made through this portal. New investors can find the portal quite confusing & not much investment insights are available as part of portfolio analysis. Here is the link - https://www.mfuindia.com/


Karvy or myCams - Both these mechanisms provide direct mutual fund plans. The limitation of both these platforms is they provide investment options only for selected fund houses. In case your asset management company is not listed on either of the portals, you will again need to split your investments across multiple platforms - which destroys the entire purpose.


MoneyFront - Moneyfront has almost all direct mutual funds available on it's platform. The drawback lies in it's pricing strategy. Currently they charge INR 100 per month which is billed annually. Umm..We understand not many investors will like this, specially the ones who invest periodically by analyzing the market conditions & the ones who don't put a huge amount into SIP's. The sole reason for investing in direct mutual funds is to save money, then why do you want to pay to the platform? If you wish to explore further, here is the link https://www.moneyfront.in/

Zerodha Coin - You could choose to invest into both regular and direct plans through the Coin platform. Looking at the recent competition, Zerodha has stopped charging investors for direct plan investments. However, they're still missing major chunk of features which few other websites offer like external investments tracking etc. Here is the link if you still want to give it a try. - https://coin.zerodha.com/


KUVERA - Yes believe it or not, you can invest into direct mutual fund plans at zero cost along with multiple premium features like family account, Smart Switch, Pause, Modify SIP etc. The sign up process seems pretty easy & the verification process is as fast as it can get. The direct plans of all fund houses are available on their platform. You could also import your existing portfolio by uploading Karvy's Combined Account Statement. The dashboard provides meaningful insights on the portfolio performance. I have personally switched all my existing SIP's to this platform & this is my RECOMMENDATION. Here is the link - https://kuvera.in/


Mutual funds as an investment instrument has been gaining popularity over the years, thanks to the wide range of options available and the ease of KYC process. To know more about them, check out The Mutual Funds Sahi Hai campaign, launched by The Association of Mutual Funds in India (AMFI) at www.mutualfundssahihai.com


Please share your thoughts on the article in the comments sections below!!

3 comments:

  1. You have missed ETMoney(from Economic Times) it is my personal MF investment App and user friendly for SIP form of investment with OTM in an easy process, but missing options are SWP( Sytematic Withdraw plan) & STP(Systematic Transfer play). I recommend for beginners of MF who like to invest through monthly SIP investment.

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  2. I like this post,And I figure that they having a great time to peruse this post,they might take a decent site to make an information,thanks for sharing it to me. free stock course

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  3. What about Goalwise ? They changed all their regular funds to direct funds recently in June. It is also a good platform with many features that are all free of cost absolutely. Should check them out once, their customer service is top notch. I would rate it 5/5.

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