How to Invest in Mutual Funds?

Many people across India still don’t know that How to Invest in Mutual Funds? Many times I receive a query like, “Hii, I want to invest in Mutual Funds but don’t know which Demat Service to prefer?”

Many people still don’t know that it doesn’t require any Demat Account to buy Units from Mutual Funds. However, you can invest in mutual funds via Demat Account also.

Here are the various ways to invest in Mutual Funds -

01) Once most common way to invest in Mutual Funds is, Directly buy MF Units from a Fund House. Simply Google the web and find a fund House website of a MF in which you want to invest. After that simply find your local area customer care number. Call them and their executive will visit at your Home with a Form. You Simply give him a cheque in favour of a Mutual Fund and fill the form. That’s it. You will start receiving your MF Units statement every month or so once you invest in Mutual Fund.

This is the Best method to  invest in Mutual Funds because investing in Mutual Funds directly via Fund House will attract ZERO Entry Load. While if you invest through your Demat Account or a Broker than it will attract you up to 2.5% Entry Load.

But again this method is cheapest but it has limitations. If you don’t know which mutual fund to invest or don’t know anything about choosing a Best MF than this method is not for you.

02) Another way to Invest in Mutual Fund is via Demat Account. Online Demat Account is preferable. I Personally Invest through ICICIDirect.com.

The main advantage of this method is that, Online Demat services have a List of all the fund Houses and MF Schemes available so you can cheque and compare the NAVs of various Mutual Funds across various Categories. You will find all the Mutual Funds at one stop only. But again it has Limitation. The Limitation is that, it will attract up to 2.5% of Entry Load.

03) Another way of Investing in Mutual Funds is Invest through a Mutual Fund Broker. A Broker is a person who has a sound financial knowledge of every mutual funds and he will assist you in choosing a Best Mutual Fund that fits into your personal needs.

Of course, if you will invest through a Broker, it will attract commission of a broker. But if Broker is Professional & Financially Intelligent than this commission is worth… If you don’t know anything about mutual funds than highering a trust worthy and professional broker is highly advisable. A Broker can help you to select a perfect MF according to your needs.