Create an Account

Its Free and always will be!

Sign up or login with your social accounts
Birthday
Day

Top 5 Best Stock Broker In India

List of Top 5 Best Stock Brokers in India 2018 Will try to give you hand picked Best top 5 Stock Broker list and pro and cons of the Broker so it will help you to find which is best stock broker for y...
Continue reading
Rate this blog entry:
0 Comments

Unlimited profit with discount broker in India

A discount broker is the one that executes your buy and sell of orders at lesser fees than the full-service brokers . However, they rarely offer detailed advisory or research call to specify the stock...
Continue reading
Rate this blog entry:
1 Comment

How to Trade in Range Breakouts

The Best Way to trade Range Breakouts Each Day trading system conforms to intraday breakouts. Dealers use breakouts to set entry points and exit targets due to their transactions. In this article, we ...
Continue reading
Rate this blog entry:
0 Comments

SIP and the Magic of Compounding

The first rule of investing is to start now irrespective of your age. A disciplined investor is able to earn higher returns and build more wealth through the power of compounding. About compounding Co...
Continue reading
Rate this blog entry:
0 Comments

WD Gann's Mysterious World

Every aspect of life connected via the cycle of discovery and rediscovery, with many dedicating the totality of their life to pursue the unraveling of many mysteries some of which has left us in awe a...
Continue reading
Rate this blog entry:
0 Comments

Direct Mutual Fund vs Regular Mutual Fund

Let us talk about, Mutual Fund scheme has a Direct Plan and a Regular Plan.

An Direct Plan -- You can buy straight from the mutual fund companies typically from websites and normal Strategy You can buy through mediator like agent, adviser, distributor etc.. Commission is paid to the intermediary by business in Routine plans. If you invest in Mutual Funds through a broker or a distributor, then you are investing in Regular Plans. However, when you invest through the Mutual Fund straight or seek the aid of an advisor you invest in Direct Plans. All indirect Strategy of mutual fund schemes require the term"Direct" or"Direct Plan" to be clearly mentioned in the strategy name.

Mutual Fund Houses/AMCs (Asset Management Companies) -- You can Directly visit the Mutual Fund website of this finance. All you have to do would be to fill out an application form searching for your personal details, bank account details, KYC etc. and you'll be allotted the units upon payment. Through MFU(Mutual Fund Utilities)/CAMS (Computer Age Management Services) and SEBI registered investment consultants can simply recommend direct plans.

Regular plan you invest through a Distributor or advisor. AMCs usually pay some commission to agents for their services. Now, investors can avoid paying these commissions and it will Translate into more yields each year. The Direct Plan has a lesser Expense ratio as compared to existing Regular plans at the very same schemes plan. Investments under the Immediate Plan are open to all investors that Choose to spend without intermediary.

The direct plans of mutual funds generate higher returns as compared to regular plans. Depending on the expense ratio this difference in returns could be as high as 1.5% yearly. Due to the power of compounding this 1.5% could swell into a sizable amount over a long period of time.

Amount Return % p.a. Tenure Regular Plan Direct Plan Difference
Rs. 15000 8.00% 10 27,44,191 28,44,373 Rs. 1,00,182
Rs. 25000 8.00% 10 45,73,651 47,40,622 Rs. 1,66,971
Rs. 15000 12.00% 15 74,93,703 79,65,424 Rs. 4,71,721
Rs. 25000 12.00% 15 1,24,89,505 1,32,75,707 Rs. 7,86,202

 

  • If I invest a sum in HDFC 200 Regular and Direct:

After 1 year: If the regular fund has a value A, the direct fund will have value (approximately)

A x (1+0.5%)

After 3 years: If the regular fund has a value B, the direct fund will have a value (approximately)

B x (1+0.5%) x (1+0.5%) x (1+0.5%) and so on.

In the above example I have assumed 0.5% as a constant difference in expense ratios. If this difference is 0.5% in 1st year, 0.4% in 2nd  year and 0.6% in 3rd year then we will have:

B x (1+0.5%) x (1+0.4%) x (1+0.6%)

So if you disciple to stay invested for a long period of time a ‘good’ fund then can be a significant difference in corpus.

Direct plans definitely have more benefits than regular plans. Portfolio will be the same for both Plans. Investment Objective, Investment Strategy, Exit Load, risk factors, facilities offered and other terms and conditions will continue to be same.

It is obviously better to invest in direct plans for higher returns, but this also requires more hard work from the investor as he has to do the paperwork and choose a suitable fund.

Do not fear, we have a Online Platform where you can compare and invest in direct mutual fund without paying commission you can save upto 28 lacs in 25 yrs. comprehensive automated advisory that is based on a scientific algorithm and will recommend you to invest in best schemes to fulfill your goals. We providing you all the information you ever need.

Always look for or ask for the word “Direct” or “Direct Plan” to be clearly mentioned in the scheme name in your portfolio statement.

Read Complete Article Difference Between Direct Mutual Fund and Regular Mutual Fund and know how to save 25 lacs in 25 yr just to switch 

Zerodha Coin - Direct Mutual Fund Platform

Thanks

Gunjan Chokshi

Certified Financial Advisor

SEBI Register Investment Advisor

Continue reading
Rate this blog entry:
1 Comment

Reliance Retirement Fund – Pension Product in a New Package

Reliance retirement fund People have finally started to realize the importance of retirement planning and have started discussing the possibilities and options with their respective financial advisors...
Continue reading
Rate this blog entry:
0 Comments

Tax Benefits of Health Insurance Plans

Health insurance is basically a type of insurance policy that is bought to cover the cost of future medical care. It has a number of advantages and provides coverage against quite a few potential liab...
Continue reading
Rate this blog entry:
1 Comment

What is Discount Brokerage ?

What's Discount Brokerage? Discount Broker is that offer lowest Brokerage for purchase and sell shares to the customer. However Discount Broker not offer investment advice or study analyst of script t...
Continue reading
Rate this blog entry:
1 Comment

Does "Following a Herd" Mentality Help While Buying New Stocks?

One of the most recent financial events would be the dot com bust. However, this was not the first time that such events have occurred and neither would it be the last. You must wonder how such catast...
Continue reading
Rate this blog entry:
0 Comments

How to Buy IPO Stock on First Day?

It's tempting to invest in IPOs but below are a few reasons to think again before you do that. Initially, is a fantastic idea. If I'd purchased 100 Reliance on its IPO in 1986 until 2017. The Difficul...
Continue reading
Rate this blog entry:
0 Comments

PSU Banks Analysis for 2018

In last few days, market has been so confusing that even stoplosses were also not proved to be a good method for traders to secure their money. For instance, on 16 May, rcom was trading at Rs 10. And ...
Continue reading
Rate this blog entry:
0 Comments

Popular Investing Books

Robert J. Shiller
Parag Parikh
Charles Mackay
Mel Lindauer
Robert T. Kiyosaki
Peter Lynch

Search Blogs

Most Popular Authors

Top 100 Investment Blogs

Reduce your Brokerage by 100%!!

Be a Smart & Well Informed Investor!
Join Today its Free.
Register or Login with just one Click using your Social Account