Best answer: Should I invest in direct or regular mutual funds?

The returns of any direct mutual fund are always higher than the regular version of the same mutual fund. The main reason behind this is the ‘expense ratio’. The expense ratio is lower for direct plan vs regular plan as mentioned above.

Which is better regular or direct mutual fund?

Difference Between Direct VS Regular Mutual Fund

The direct plan of mutual funds gives higher returns than the regular funds as they do not include broker fees. Additionally, the returns keep compounding. A professional financial advisor can help you to understand and manage your funds more efficiently.

Is it good to invest in direct mutual funds?

In due course, the lower expense ratio of Direct Plan translates to higher returns on the investments which keeps compounding over the years. Thus, the investment in Direct Plan would be worth more over a period, in comparison to investment in Regular Plan of the same scheme.

What are the disadvantages of direct mutual funds?

Disadvantages of investing through a Direct Plan

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Comparing and analysing mutual fund performance and comparing it with the investment strategy most suitable for you requires more effort and attention than the Regular plan.

Why is Direct plan NAV higher?

The NAV of direct plans is higher than their regular counterpart because of their higher returns. As the operating expenses of the fund is reduced from its net AUM, the lower expense ratio of its direct plan results in higher NAVs.

What happens when I switch from regular to direct mutual fund?

Since switching from regular funds to direct mutual funds is considered as a new investment, the switch can attract tax on capital gains. The applicable taxes can also vary depending on the type of capital gains i.e. long-term or short-term capital gains.

Which app is best for direct mutual fund investment?

6 Best apps to buy direct mutual funds

  • Coin by Zerodha. This is one of the simplest apps to make investments in mutual funds. …
  • Groww. If you’re just starting to make mutual fund investments, Groww is the app for you. …
  • Paytm Money. …
  • CashRich. …
  • Kuvera. …
  • ETMONEY.

Which mutual fund platform is best?

7 Best Mutual Fund Apps for Direct Investment:

  • Groww – Direct Mutual Funds App. Groww app is one of the fastest-growing apps in the Indian mutual fund industry. …
  • ETMONEY Mutual Fund App. …
  • myCAMS Mutual Fund App. …
  • KFinKart – Investor Mutual Funds. …
  • Zerodha Coin. …
  • PayTM Money Mutual Funds App. …
  • KTrack mobile app by Karvy.

What is difference between direct plan and regular plan?

Direct plans are directly offered by the fund houses whereas regular plans are bought through intermediaries or distributors like Independent financial advisers, banks or NBFCs. 2. Direct plans have no commissions and brokerage whereas for regular plans, commission or brokerage is paid to the intermediaries.

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Is SIP better direct or regular?

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 is the benefit of direct mutual fund?

After knowing the advantages of investing in direct funds over regular funds, it’s only wise to invest in direct funds. You can save on paying unnecessary commissions and keep the expense ratio on the lower side. Also, you would get higher returns on direct funds when compared to that of regular funds.

Should I switch to direct plan?

The expense ratio on direct plans is less than that levied on regular plans and therefore offers a higher return than the regular plan. The expense is charged to the overall investment corpus and hence the impact over long investment horizons would be sizeable.

How do I get more returns on my mutual funds?

5 Ways to Boost Portfolio Returns With Mutual Funds

  1. Use No-Load Funds.
  2. Use Index Funds.
  3. Dollar-Cost Averaging.
  4. Buy Aggressive Funds.
  5. Asset Allocation.
  6. Bottom Line.