We’re really excited to announce the launch of our Direct mutual funds platform “FYERS Direct” to the investing community on the 74th Independence day of India. To further our aim of increasing capital market penetration and to enable savings without incurring recurring fees or commission of up to 1.5% of the investment amount for all investors. We thank the capital market regulator, Securities and Exchange Board of India (SEBI), for allowing the exchanges & depositories to make it happen seamlessly.
The platform is crafted to cater to your mutual fund investments in the best way possible. Mutual funds purchased on FYERS Direct will be credited directly to the clients’ demat account and not in any virtual wallet unlike many other platforms out there. Through FYERS, you get the convenience of accessing a holistic portfolio across direct equity and mutual funds. Clients can either trade and/or invest in multiple financial instruments through a single demat account, supporting the ease of transactions. Demat accounts are comparatively safer than other alternatives due to timely notifications related to account transactions, which are made available via email or a simple phone call to our support team.
Why Direct Mutual Funds through FYERS Direct?
It is common knowledge that money saved is as good as money earned. In the current scenario, with effective real rate of returns being negative due to high inflation, it has become imperative to invest smartly and to stay informed of finances. But, did you know that you could be smarter and savvier with investing in a direct mutual fund plan? Regular as well as direct mutual fund schemes are the two options to invest in any equity or debt mutual fund scheme, actively managed by fund managers. A crucial difference between the regular and direct plans is that, in the case of a regular plan, an AMC or fund house pays a regular commission to a mutual fund distributor as distribution expenses or transaction fee out of your investment corpus. Whereas, direct mutual fund plans do not have any provisions of commission to the dealer or distributor and hence, in comparison, direct plans offer higher returns. A detailed comparison between Regular and Direct Mutual Funds – Regular Vs Direct Mutual Funds – Which Is Better?
A direct mutual fund scheme provides higher returns for your investments, as the expense ratio of a regular mutual fund plan is approximately two times more than the corresponding direct mutual fund plan. The expense ratio is essentially an annual fee deducted by all fund houses from the unit holders’ assets as part of the operational cost of the scheme. This operational cost includes commission fees, record keeping, taxes, legal expenses and accounting. The commission fee paid to the distributor of the fund is the largest expense of operational cost.To understand better, let’s take a look at an example.
For instance, Mr. Ajit and Mr. Sujit invested a lump sum amount of ₹50,000 in the same equity mutual fund scheme, but with regular and direct plan respectively. Regular fund grows at a CAGR of 9% whereas the direct fund has grown at a rate of 10.5%. At the end of 30th year, this investment of Mr.Ajit would be worth ₹74.28 lakhs. On the other hand, Mr. Sujit who invested in the direct plan of the exact same scheme would notice a saving of 1.5% in annual commission, and his investment corpus would be worth ₹1 crore over the same period. In other words, a quarter of the hard earned money ends up as commission to the distributor, instead of being invested in the scheme. There are many other positives for choosing the option of investing through a direct plan. To read more, visit: 3 Main Reasons To Invest In Direct Mutual Funds.
Despite the quantum of financial investments, only a small population of investors invest in direct mutual funds. This can be due to two reasons: lack of awareness or management of multiple mutual funds separately. But now, with increased investor awareness, FYERS has made it easy to manage multiple direct mutual funds, literally at your fingertips on our platform. Explore direct mutual fund schemes here – FYERS Direct.
Many investors are unaware of mis-selling of mutual fund schemes by distributors or third party entities on their platforms. Quite a few investors have shared their regrettable experiences of MF advisors and their services. Either a wrong product or scheme has been advised in favour of commission from the Asset Management Companies (AMCs). Most advisors just end up recommending mutual funds in which they have vested interest, and advice may be biased towards any fund offering higher commissions to the distributors, thereby potentially mis-selling an unsuitable product for a naive investor. With FYERS, there is no possibility of mis-selling mutual funds as we are not hand-in-glove with the fund houses and thus have no vested interest.
How to get started?
Investing in any direct mutual fund scheme through Fyers Direct is extremely simple. If you have a Trading and Demat account with us, please make sure the BSE-MF segment is active by logging into the Accounts (Backoffice) section. If you don’t have a Demat account you will need to open one with us. For more information, visit our Support Portal.
- Login to Fyers Direct using your Fyers account credentials.
- Explore the top-performing schemes from 49+ AMCs and filter them based on the returns for the period, types, sectoral/themes or the fund house.
- Choose the type of investment i.e. lump sum or SIP, enter an amount for the transaction and place the order. Note: Lumpsum amount will be debited from your trading account.
- That’s it, successful orders will be reflected on the dashboard. You can track the performance of invested funds and also add more at regular intervals.
- For Bank mandate, SIP investments or MF related queries, you can visit our dedicated section of support articles for the Mutual funds.
We would be delighted to support your financial investments at all times, and look forward to your patronage and an exciting journey of investing in mutual funds through FYERS Direct !
Tejas is the Co-Founder & CEO at FYERS, the youngest team to get NSE’s broker license. He has a specialization in finance and has over 10 years of work experience spanning across proprietary trading, risk management, and broking. Tejas & his team started FYERS, a technology-focused brokerage as a mission to transform the trading/investment landscape in India.