What Every Indian Should Know Before Investing: Edition 2017: From Fixed Deposits to PPF to Real Estate, Gold, Mutual Funds, Stocks and more... explained in simple, easy-to-understand language! by Vinod Pottayil

Author:Vinod Pottayil [Pottayil, Vinod]
Language: eng
Format: azw3
ISBN: 9788190697217
Publisher: Imagine Books Pvt. Ltd.
Published: 2017-09-10T16:00:00+00:00

HOW TO INVEST IN MUTUAL FUNDS

There are many ways in which you can invest in a Mutual Fund schemes. You can invest directly with the Asset Management Company (AMC) or you could use the services of an agent, your bank, an online investing portal or a financial planner. The process for all of them is quite similar. If you are a first time investor, you’ll need to have your identity verified through the Know Your Customer (KYC) process. Once your KYC is done, you can invest in as many mutual fund schemes as you want.

When you invest in a mutual fund scheme, you are assigned a folio number by the AMC. Using this folio number, you can invest in various mutual fund schemes issued by the same AMC. For example, if you invest in multiple mutual fund schemes of Edelweiss Asset Management, you’ll get a common folio number for all your investments. In case you change any investing detail, for example, if decide to invest jointly with someone, you will be assigned a different folio number. You will also get a new folio number if you invest in a mutual fund schemes belonging to another AMC. For example, when you invest in a scheme of Axis Mutual Fund and another scheme of Franklin Templeton, you will get two different folio numbers. The folio number (also called folio ID) is printed on the mutual fund statements that you receive. You can request for statements or details of your transactions using this folio number. The folio number is thus like an account number for all mutual fund schemes that you invest with a particular mutual fund house.

DEMAT ACCOUNTS NOT A NECESSITY

Unlike investing in stocks where it is mandatory for you to have a demat account, there is no such necessity for mutual funds. If you are already investing in stocks and have a demat account then you can use the same demat account to hold your mutual fund units. If you wish not to use a demat account, you can directly invest with the mutual fund, a broker or any online portal that offers such a service.

You can buy and sell your Mutual Fund units by physically filling and submitting forms with the mutual fund or broker or you can even do it online through the websites of the AMC or service provider. If you opt not to have a demat account, you save on demat and trading charges. With a demat account, you will have the convenience of having all your mutual fund investments at a single location and receiving consolidated account statements for all your mutual fund holdings.

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