Table of Contents
What is difference between regular and direct mutual fund?
The only difference between these two is, in case of a regular fund your mutual fund house pays a commission to the broker/agent as a distribution fee whereas, in case of a direct plan, no such fees/commission is paid.
What is difference between direct and regular fund?
A Direct plan is what you buy directly from the mutual fund company (usually from their own website). Whereas a Regular plan is what you buy through an advisor, broker, or distributor (intermediary). In a regular plan, the mutual fund company pays a commission to the intermediary.
Which one is better lumpsum or SIP?
If you are an investor with a small but regular amount of money available for investment, SIPs can be a more suitable investment option. For investors with a relatively high investment amount and risk tolerance, lump-sum investments may be more beneficial.
What is the difference between direct and regular mutual fund plans?
Net Asset Value (NAV): The TER of any mutual fund plan is adjusted from the NAV. Since TERs of regular plans are higher than those of direct plans, the NAVs of direct plans are higher than the regular plans. In other words, your investment value after you have made your purchase will always be higher in a direct plan compared to a regular plan.
What are the different types of mutual funds?
A mutual fund can be of two types – direct and regular. A regular mutual fund is generally invested in through a brokerage house, mutual fund advisor, or agent. While in a direct mutual fund, you can invest in the mutual fund house directly.
What are direct funds and should you invest in them?
Direct funds are generally just a different version of the regular mutual funds. The only difference is that the traditional agent/broker is not involved. As seen above, this simple exclusion has a multi-layer impact on your NAV, return on investment, and general relationship with the AMC.
If the fees paid to the agents can be avoided, then the amounting NAV is higher. As a result, direct funds have a higher NAV than regular funds of the same mutual fund. As a result, your total investment value is higher in a direct fund. Let’s take the help of an example to understand exactly how this might affect you: