Mutual Fund Investment Guide: Indian investors have been considering investing in mutual funds as a better investment option. However, while investing in mutual funds, many investors are not able to decide whether they should choose direct fund or regular fund.
Before selecting either of the two options, you should know the expenses, returns and investment process. So that, you do not face any kind of problem in future. You should also know about the disadvantages and advantages of both the options.
Investing directly in mutual funds
When investing in direct mutual funds, you invest directly in the fund house or Asset Management Company (AMC). In which no agent or distributor of any kind is involved, hence you do not have to pay commission. Because of this the expense ratio of these funds reduces. Also, you can get better returns if you invest for a long time.
Investors who have market knowledge and like to do their own research. Direct funds are a good option for them. Such investors can start their investment journey through AMC’s website and mobile app.
Investing in regular mutual funds
Investment in regular mutual funds is done with the help of advisor, broker or distributor. They help investors choose the right fund. Investors are charged for this. If you do not understand the intricacies of the market and do not want to do your own research, you can invest in regular mutual funds.
Which fund is right for you?
While choosing between direct mutual funds and regular mutual funds, you should know your financial goals and your knowledge of the market. If you do not have market knowledge then regular mutual fund may be right for you. At the same time, if you want to select the fund yourself and have understanding of the market, then you can choose direct mutual fund.
Disclaimer: (The information provided here is being given for information only. It is important to mention here that investment in the market is subject to market risks. Always take expert advice before investing money as an investor. ABPLive.com never advises anyone to invest money here.)
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