Table of Contents
- 1 What is the commission for mutual funds agents?
- 2 How are commissions paid on mutual funds?
- 3 What the trailing commission actually covers?
- 4 What is the commission structure for mutual fund distributors?
- 5 What is the MF agent commission structure?
- 6 How are commissions on mutual fund schemes paid out?
What is the commission for mutual funds agents?
Your mutual fund agent will receive it whenever you invest newly. This commission varies from product to product, high in ELSS funds (around 4.5\% to 1\%), equity schemes (around 0.5\% to 2.5\%) and low in debt funds (around 0.2\% to 0.8\%).
How are commissions paid on mutual funds?
When you purchase a mutual fund with a sales load, part of that additional expense is used by the mutual fund company to pay a commission to the advisor. Part of that fee goes toward paying the broker a trailer commission, so long as the client remains invested in the fund.
What is the difference between mutual fund distributor and agent?
In a way, both are supposed to help with your investment decisions, which may include selection of Mutual Fund schemes. However, as the name itself suggests, a Mutual Fund distributor is more likely to be focused on Mutual Fund products, whereas an investment advisor may have a broader basket of products and services.
What the trailing commission actually covers?
3. Trailing commissions
- It’s paid out of the fund’s management fee.
- It typically ranges from 0.25\% to 1.5\% of the value of your investment each year.
- It is to pay for the services and advice the company and the advisor provide to you.
- The company may pay all or part of the commission to your financial advisor.
What is the commission structure for mutual fund distributors?
The primary source of commissions for the mutual fund distributor includes: 1. Trail Commission This commission is usually the primary source of earnings for the mutual fund agents. Depending upon the mutual fund schemes and AMCs, the commission structure varies from 0.1 per cent to 2 percent.
What is the commission paid by AMC in mutual funds?
The commission payable on the scheme by the AMC is part of the mutual fund scheme’s expense ratio which also includes other costs like fund management, administration, marketing, accounting etc. Also, the commission structure differs across the cities.
What is the MF agent commission structure?
According to the MF agent commission structure, this is the commission that the agent will get from the Asset Management Company or Mutual fund companies in the first year. And this commission is included in the total expense incurred in the mutual funds.
How are commissions on mutual fund schemes paid out?
Commissions on mutual fund schemes are paid out to the distributors by AMCs directly into their associated bank account which was shared at the time of empanelment. The AMCs make monthly payments of commissions to the distributors based on the rates for different schemes highlighted in the “broker structure”, which is shared with the distributor.