Mutual Fund Investments – Online Or Through An Agent?
It is highly recommended that you open a mutual fund account online instead of depending on someone to help you open a mutual fund account. Read more about Ethereum Code and understand how to buy mutual funds online here.
This is because when you buy the equity mutual funds through an agent then you are charged an entry load and this is a percentage amount of the total that you wish to invest into mutual funds. This is a fee that is actually passed on to the agents in the form of a commission. So when you invest online you save on this extra fee.
The mutual fund advisory
The mutual fund advisor is someone who serves the mutual fund house. His role is to educate the investors and sells the mutual fund plan to the customers. So basically he markets the product of the fund house to the customers and in return for that, he charges a commission. The fee or the commission is paid by the mutual fund company to the agent and the amount of this commission is charged from the customer in the form of an entry load.
Buy mutual funds without a broker
There are today some regulations in place where when you buy the mutual fund schemes online you do not have to pay the entry load fee. Earlier the entry fee was applicable whether you purchased it online or through a broker. However, today many mutual fund companies do not charge you an entry fee if you buy it online. This is also one of the best and the cheapest ways to invest in the mutual fund’s schemes.
The entry load amount is a substantial amount if you have invested a good deal of money into the mutual fund scheme. So you definitely save on this extra fee when you buy the mutual fund online.
If the market is bullish then this extra fee may not be very noticeable to many. But in a falling market, the falling prices and on top of it the extra payment towards the entry fees would definitely pinch.
The mutual fund purchased without an advisor
You may buy the mutual fund through the websites and this saves you plenty of paperwork. All the formalities are also done online.
This has definitely helped the investors. But if you have an advisory who actually gives you sound advice and someone whom you trust completely then it is best to buy the mutual funds through him. You definitely do not want to end up buying a wrong mutual fund scheme which may happen if you are not very knowledgeable about this subject or do not have the time to understand about the mutual fund scheme. If that is the case then you can buy the mutual fund scheme through an agent whom you trust.