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How to purchase or buy and invest in mutual funds

There are 5 ways by which you can invest in mutual funds.

Through a Financial Advisor:

This the oldest and most popular way of investing in mutual funds in India. AMFI, an industry association of all the SEBI approved AMCs, provides licenses to financial advisor to advice customers on mutual fund investments. The financial advisor provides end to end to services, including collecting KYC (Know your Customer) documents, filling the application forms and getting your signatures and submitting them for processing. Most financial advisors do not charge any fee from their customers. They are paid commissions by the mutual fund companies. If you are new investor it is recommended that you invest through a financial advisor. Before investing through financial advisors, you should check if they have a valid AMFI license.

Investing directly with the Mutual Fund companies:

You can visit the office of the mutual fund companies and invest directly at their office. If you are investing for the first time, you need to submit the necessary documentation for KYC (identity proof, address proof, PAN card etc) along with the duly filled application form at the mutual fund. Once a folio number is generated for you, you can invest online in any scheme of the mutual company by going to the website of the company.

Investing through registrars (CAMS or Karvy):

CAMS or Karvy are registrars who process the mutual fund transactions and keep records on behalf of the mutual fund companies. You can visit CAMS or Karvy offices and submit the mutual fund application forms there, just like investing directly with mutual fund companies.

Investing through online portals:

There are several online portals like fundsindia.com and fundsupermart.com through you can invest in mutual funds. To invest through the online portals your KYC has to be registered. Some of the portals can also help you with getting your KYC registered. One of the advantages of investing through an online portal is that you can view your entire portfolio (investment in mutual funds of different companies) in one place. However, you should know that these online portals are registered mutual fund distributors like your financial advisor and earn commissions from the mutual fund companies. Hence investing through them is not necessarily cheap.

Investing through your online demat account:

Some brokers who provide online trading and demat services, also offer online investment in mutual funds. Brokers who offer this service like ICICI Direct, India Infoline, Anand Rathi, HDFC Securities, Sharekhan etc are registered mutual fund distributors.


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