Confused about investing in mutual funds in times of Covid? Here are your options

By: |
August 3, 2020 1:27 PM

If you choose to invest through these fund houses, you will be able to invest only in the schemes of that particular fund house. However, you will not have to pay any agent or brokerage charges.

Mutual fund, Mutual fund industry, Mutual fund industry AUM in june 2020 quarter, debt fund, equity fund, asset under management, investing in stock, where to invest in stocks, MF investment, MF investment in equity markets, SIP, stock markets, sebi, COVID-19 outbreak, bajaj capital, market news,There are many ways to invest in MF but investments in mutual funds. Find the one that suits you the best;

Many people are keen on investing in mutual funds but are confused about how to do so in the current pandemic. That is because, during these times, it is scary to step out of the house to get anything done. But thankfully, you can also invest in mutual funds online.

Additionally, if you are a new investor, you will have to carry out KYC or KYC compliance through a Sebi-registered intermediary — distributors or online platforms, mutual fund houses —via the KRAs (KYC registration agencies). It is a one-time process, mandated by Sebi to prevent fraud. It also verifies an individual’s identity as a mutual fund investor.

There are many ways to invest in MF but investments in mutual funds online can be done in two ways, either through the official website or through an app.

Here are your options to invest in a mutual fund;

Mutual Funds Houses – Asset Management Company (AMC) – This is for online, offline, and mobile apps. An investor can physically visit an AMC office and start investing if his/her KYC is done. One can also do so by visiting the fund house website. Some MF houses also have apps to invest in funds.
If you choose to invest through these fund houses, you will be able to invest only in the schemes of that particular fund house. However, you will not have to pay any agent or brokerage charges.

Demat account – This is another way to invest directly. With a Demat account, investors can invest in funds directly, in all securities—mutual funds, stocks, government securities, bonds, exchange-traded funds, from one place. With a Demat account, investors are an annual fee as brokerage charges, along with the expense ratio.

Fintech investment platforms – These online mutual fund aggregators or third-party platforms are like RTAs. They offer investors the facility of investing and conducting all transactions through their sites. Some of the popular fintech investment platforms, include Groww, FundsIndia, Scripbox, etc.

Stock Exchanges – Earlier this year, Sebi allowed investors to invest in MFs directly through recognized stock exchanges. This will allow investors to bypass brokers or intermediaries. However, if you want to invest through the stock exchange, you will be needed to complete a one-time online registration with NSE or BSE.

Registrar and Transfer Agents (RTAs) – You can visit any of the Sebi-registered RTAs and start investing in MF. To do so, however, you will have to complete the application form and submit a cheque or bank draft at the branch office. Some of the well-known RTAs are CAMS and Karvy. If you choose to invest in MF through RTAs, you can pick and choose schemes across fund houses, instead of investing from a single fund house.

Investor Service Centres (ISC) – These Service Centres are the physical branch offices of mutual funds or RTAs all over the country. Investors can conduct all transactions, starting from investment to redemption, at these centers.

MF Utilities (MFU) – Mutual Fund Utilities are a shared service platform, which is owned by several AMCs for fund transactions and is promoted by the mutual fund industry. Investors can use this to invest either online or offline.

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