How to invest in mutual funds (MFs) online: From KYC to direct plans to fund selection —A complete guide
Investing in Mutual Funds(MFs) has become much easier compared to the experience a decade ago
PremiumHow to invest in mutual funds (MFs) online: Mutual Funds are a smart way to grow your money. They can help you achieve your financial goals if you stay invested for the long term. There are multiple ways to invest in mutual funds. You can invest directly from the website of the fund house or through investing apps. Investing online is simple, fast, and convenient.
Investing in Mutual Funds(MFs) has become much easier compared to the experience a decade ago.
Here’s how to invest in mutual funds online.
PAN
A permanent account number (PAN) is the biggest requirement.
KYC compliance
It is mandatory to be compliant with know-your-customer (KYC) norms
Investors should ideally buy direct plans
Every mutual fund scheme comes in two versions - Regular and Direct. Investors should ideally buy Direct versions of the MF, since these give up to 1% more returns than the regular variants, said Amber Pabreja, Founder and CEO of Trendlyne.
Broking platforms offering direct Mutual Funds
An ideal option to make the investment is an online broking platform, one that gives you the choice to buy MFs as well as equities. As per Amber Pabreja, some of the brokers currently offering direct MFs are Zerodha(Coin), Groww, 5Paisa, and Paytm Money.
Fund selection
To choose the right Mutual Fund, investors should look beyond past returns, and check ratings. “This is important since checklists tell you for example, how much risk the fund has taken to deliver the returns, the health of the underlying assets, etc. All that glitters is not gold, and these tools scratch the surface to make sure," said Amber Pabreja.
According to Amit Gupta, MD, SAG Infotech, to invest in mutual funds online in India, investors should research and choose a reputable SEBI-registered mutual fund provider.
-Open an account and complete the KYC process
-On the basis of your investment goals, select the appropriate mutual funds.
-Read the fund's offer document, decide on the investment amount, and initiate the transaction online.
-Monitor your investments regularly and make adjustments as needed.
-Remember to consider market risks and consult with a financial advisor if necessary.
How to invest in mutual funds?
1) You can invest in mutual funds by filling out an application form along with a cheque at the branch office of mutual funds or registrar & transfer agents of the respective mutual funds.
2)The investor can also invest through the websites of the relevant mutual funds via online mode.
3) You can invest with the help of a financial intermediary, i.e., a Mutual Fund Distributor registered with the Association of Mutual Funds in India )AMFI).
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