A mutual fund is an investment plan which is created by funds collected from various investors for investing in securities like bonds, stocks, money market instruments and similar assets.
What are direct mutual funds?
Sharing of profits to your stock brokers is not required in direct mutual funds. Direct mutual funds removes the middlemen between the investor and the asset management company. In this case the trial fees, distribution charges and commission paid to the middlemen is not applicable.
Why should I invest in direct mutual funds?
It is always advisable for an investor to invest in plans which gives them higher returns. Direct plan has lower expense ratio as payments to distributors need not be done. The returns you can make on a direct plans are higher by approximately 0.5% for equity funds and approximately 0.2% for debt funds. Â
Why should I shift from regular to direct mutual funds?
If you are an expert in trading, then itâ€™s only fare if you enjoy all profits to yourself instead of sharing them with your brokers. You can switch to a direct plan if you are a diligent investor with good knowledge in mutual funds.
How does expense ratio gets affected in direct mutual funds?
The expense ratio is a measurement of cost the investment company has to bear to operate a mutual fund. The expense ratio is the fund’s operating expenses divided by average value of the fund’s Asset Under Maintenance. This is determined by an annual calculation.
Is the net asset value higher for direct mutual funds?
The value of NAV is determines the total fund assets minus the total fund liabilities divided by outstanding units. In a direct mutual fund the liabilities of the fund do not include any commission or transaction fee charged by the AMC. Hence the calculated value of NAV is higher for Direct funds.
Investing in direct mutual funds through tradeplus:
Tradeplus offers an easy online platform to invest in Mutual funds. You should choose Tradeplus for your mutual fund investments for the following reasons:
- Invest in Direct Mutual funds in equity, debt and hybrid categories
- The minimum charge of Rs.50/- per month is our selling point
- Investors can enjoy no charge on investments upto Rs.25000/-
- Place an order under the conditional order option
- Place a completely customized order using the Flexi SIP option
- Add funds to your watchlist
- View top performing funds
- Use Switch calculator to make a decision to switch to Direct Mutual Fund investments
- Use Savings calculator to determine your savings for an investments