Nowadays, Investing in small or big mutual funds could not be easier than this. Here are the top 4 greatest easy ways in which you can also invest in mutual funds online.
Asset Management Companies (AMC)
Mutual funds are originally managed by Asset Management Companies. Investing through AMCs means that you are directly purchasing mutual fund from the source. All you need to do is visit their website and follow these steps:
Open your account.
Fill in your details regarding the investment. Fill in the FATCA form. Provide bank details. Upload the photograph of the preliminary canceled cheque. Verify your KYC and transfer cash. This is a cost-effective method as you do away with any intermediaries.
Here, you get to make your very own investment decision and choose your best fit. The only drawback is that you need to open different accounts for different AMCs making it a time-consuming process. Some major Asset Management Companies are DSP BlackRock Mutual Fund and TATA Mutual Fund.
Broker/Demat Account
Popular broker companies like Zerodha and Kotak Securities have made it easier for investors, especially in the online era.
How to make investments via broking?
Open a Demat account on their app, select the scheme you want to take, make the payment, and the mutual fund units get transferred to your Broker account. This is more of a relaxed approach as most of the responsibilities are taken care of by the broker firm.
Besides you get well-researched performance reports of mutual fund so that the user can make an informed decision. A broker, being an intermediary, charges a commission for providing its services, primarily for maintaining the Broker account.
Individual Apps/Website
In recent times, there has been a wave of individual apps/websites that provide an easy pathway to investment. Applications like Paytm Money, ET Money, and Groww, permit investing directly at no commission. A consolidated view of your holdings and easy monitoring are extra blessings of this route.
Online Investment Platforms (Regular Plans)
Such platforms provide single account access to all the mutual funds with various AMCs. All you want to do is, create an account, choose the plan, select the payment type (SIP or lump-sum), fill in the required personal credentials, and transfer the money online to complete your investment.
Quick pointers on investing in mutual funds
A mutual fund portfolio is subject to market risk. It does not promise fixed returns, unlike government bonds. One must study the Offer Document and mutual fund details before investing. A financial backer should adhere to his possessions in any event when markets are unstable. In the long- term, a mutual fund is profitable.
Beginners can invest in mutual funds using individual apps like Groww and as they garner knowledge and experience, they can gradually switch to other ways as well.
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FAQs
What are 3 ways to make a plutocrat with collective finances?
When you buy into a collective fund, your investment can increase in value in three ways:
1) Tip payments – When a fund receives tips or interest from the securities in its portfolio, it distributes a commensurable quantum of that income to its investors.
2) Capital earnings
3) Net asset value.
What are the 4 types of collective finances?
Most collective finances fall into one of four main orders – plutocrat request finances, bond finances, stock finances, and target date finances. Each type has different features, pitfalls, and prices. plutocrat request finances have fairly low pitfalls.