No entry load for direct investment- what does it mean for you?

If you are making investment in MF ( one time or SIP), if you route your application through a broker..You will be charged entry load.
What should you do
1) You can directly send the form to concerned AMC/ Investor service center.
2) Cancel all your SIPs made through agents and send a fresh form to avoid entry load on further installments.
MF bought through sites like ICICI direct, India info line would also be considered as investment through brokers. You will be charged entry load on these investments.
If you can choose your fund....all you need to do is fill the form and send it to concerned AMC/ Investor service center to save on the entry load.
Happy Investing in 2008.


Anonymous said...

Thro' a Finance Advisor, I have opened on 1-Apr-2006 a monthly 1000 Rs. SIP for 3 years in a mutual fund and if I see all the transactions till now, I a not charged any entry load and monthly 1000 Rs. equivalent units are purchased for me.

Am I missing anything ?

Ideasmoney said...

Some AMCs do not charge load on SIPs even now. Since you have not specified your AMC , we are not able to comment.

Please check whether there is a column called price which is different from the NAV as of the purchase date from your folio. By this you can confirm whether you are subject to entry load.

Anonymous said...

Q1 - When entry load was deducted earlier on direct investment (without broker/distributor), where did it go? Did the AMCs eat it up or share the excess with distributors by giving them a free bonus???
Q2 - Expense ratio (recurring) includes trail commissions (around 0.5% to 1%). Who gets that in case of direct investment? WIll that be reduced as well???

Ideasmoney said...

Good questions .. We dont have definitive answers.

My best guess is the trai commissions should have got loaded into overall expenses of the fund.not sure, however.

Thanks for bringing up two thought provoking questions.

Anonymous said...

I have a question: How can one buy mutual funds without involving brokers? I have account and I prefer to do it from one single account. Is it possible to buy MF online without involving or

This question is relevant for NRIs :-) like me who dont want to get into paper formalities.

Any suggestions?

Ideasmoney said...

Download the form from web. fill it out without mistake..courier it to the AMC.

Anonymous said...

bought some reliance mutual funds online to save entry load...Was totally F*****... no correspondence from the people in case of discrepancies...

It goes like this:
U need to download a file after filling the information. I got a PDF file that was not complete. I submitted the print out and the cheque at thier AMC in thane. They took everything stamped the documents without confirming anything. My money was debited, though I didnt receive any details. After some days when I enquired I was told my application was rejected because my application is incomplete. whos fault Reliance of course. Then I asked for a refund instead of submitting the documents, Took more than a month gettng the refund. Better take an agent who returns partial money he earns as an agent. Or atleast please stay away from Reliance Mutual funds.



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