How to Invest in Mutual Funds Online in India

Hey if you want to start your investing journey from mutual funds then this article will be best for you because here we’ll explain how to invest in mutual funds online in India.

Before investing in mutual funds we need to know about the complete guide on how to invest in mutual funds. A mutual fund is the best investment platform for investors. In this article, we will learn about different types of mutual funds and how to invest in them.

Different types of mutual funds for investment

So let’s talk about different types of mutual funds for investing and how you can start your investing journey in 2023. If you are interested in investing in the stock market then here are some best agriculture stocks in India.

1. Debt Mutual Funds:

Debt mutual funds are also called fixed-income funds. In debt mutual funds you have to invest some portion of your fixed income. Debt funds offer capital appreciation for a long period of time.

Debt fund has less risk than equity Funds. Many people invest a portion of their income to reduce their annual income tax. Debt funds are more tax efficient as compared to traditional investments like fixed deposits etc.

Investing in debt mutual funds increases your portfolio balance. Return in equity mutual funds depends on the stock market, so the nature of equity mutual funds is volatile, whereas debt mutual funds are non-volatile in nature.

In debt mutual funds, you can transfer your money to different mutual funds.

2. Equity Mutual Funds:

In equity mutual funds you have to invest money in the stock market. Equity mutual funds have more risk than other mutual compared to additional mutual funds, equity funds have higher returns.

The return of equity Mutual Funds always fluctuates because its return depends on the stock market

3. Liquid Mutual Funds:

Liquid Mutua funds are one type of debt mutual fund. Some part of fixed income is invested in liquid mutual funds with a maturity of 91 days. But Net Asset Value (NAV) is calculated over 1 year.

Liquid funds have the lowest risk compared to other mutual funds.

4. Retirement Mutual Funds:

Retirement funds are also called pension Funds. We have to invest some portion of our income in the form of savings in retirement funds.

Retirement funds don’t depend on the share market or stock assets. It has less risk capacity than other mutual funds. Retirement funds offer 11% interest.

This interest depends on the policy type and investment type. This is a long-term scheme. Retirement funds make monthly payouts to investors.

5. Tax Saving Mutual Funds:

One advantage of tax-saving Mutual Funds is saving tax. Mutual funds in which tax saving is done are called ELSS funds.

As the amount of our income increases, the amount of tax also increases, but according to SECTION 80c of the government of India, if we invest our income in ELSS mutual funds, then no tax is imposed on it.

ELSS funds invest in shares of the company. Money invested in ELSS funds can’t be withdrawn before 3 years. This time limit of 3 years is called the lock-in -a period in ELSS funds.

6. Fixed Maturity Funds:

Fixed maturity funds invest in the debt mutual funds scheme for those investors who want high returns equity. In FMF we save more tax as compared to fd.

How to Invest in Mutual Funds Online in India

To invest in mutual funds, one has to submit a bank check or bank draft along with a duly completed application form. This bank draft is designed by the investor service center of mutual funds or transfer agents of those mutual funds.

Now anyone can easily invest through the Internet. To invest online, you can invest through the website of mutual funds. But you should know about some knowledge like:

• First, an investor should understand how much risk he can bear. It is important to know how much risk an investor can take.
• After deciding the risk capacity, asset allocation is imperative. After choosing an asset class, you have to divide your money into different asset classes.
• After choosing the asset class, an investor has to compare the various mutual funds for the asset class and invest in one of the mutual funds.
• Then you have to decide on the scheme of Mutual Funds and fill out the form for investment online

How to Invest in Mutual Funds through a distributor

Mutual Funds distributor registered with AMFI provides financial advice and help in Mutual funds transactions. Distributors do not charge any single amount of money.

The cost of Mutual Fund units, which are purchased from distributors, is much higher than the directly purchased from AMCs.

Investing through distributors is an act of intelligence for a new investor. The distributor of mutual funds or the financial advisor explains the risk appetite of mutual funds and tells us which type of mutual funds is right for us and less risky.

So for a beginner, it is better to invest in mutual funds through a distributor.

How to Invest Directly in Mutual Funds through AMC

An investor can directly visit the AMC office or invest through the online portal. A new investor first has to deposit in the KYC form office or online.

An investor can buy direct plans if he wants, this expense ratio is lower than regular plans. If one has good knowledge about risk appetite and the product of mutual funds, then he can directly buy mutual fund plans.

In mutual funds, the return of the direct plan is much higher than the return of regular plans.

How to Invest in Mutual Funds Directly Through RIA?

RIA stands for Registered Investment Advisors. An investor can directly invest in Mutual funds through SEBI (Securities and Exchange Board of India)RIA. RIAs are not paid any kind of commission by Asset Management Companies. So the RIA can charge for its work.

How to Invest through registered and transfer Agents?

Transaction procedures of Registered and Transfer agents or RTAs are done by fund houses. Before investing, an investor needs to know which RTAs service he is investing in the AMC scheme.

You have to go directly to the RTA website to check that the AMC schemes are respective to the RTAs service you have chosen. An investor who wants to invest in RTAs can invest in regular and direct plans. One can transact mutual funds through RTAs in various types of AMC schemes.

How to Invest in Mutual Funds through Stock Brokers?

Stock brokers provide regular plans only. Because stock brokers provide online trading, demat service, and investing in mutual funds online, stock brokers offer service through AMFI registered MF distributors.

How to Invest in Mutual Funds through a Bank?

Almost all banks offer to invest in Mutual Funds through health management. Banks are also Mutual funds distributors. Banks offer regular plans.

How to invest through a mobile app?

Many AMCs and all AMCs offer to transact through mutual funds. An investor can do all kinds of transactions through the mobile app. All these apps can be downloaded from Google Play Store or the Android Store.

Is it safe to invest in Mutual funds?

In the old era, people thought that they could secure their future only by saving money. But now, people think that instead of saving money, if they invest money, they can increase the amount of money and also secure their future.

Mutual Funds means subject to market risk. As per the definition of mutual funds, it always carries risk. For people who are not so experienced in the stock market, investing in mutual funds for the long term is more beneficial.

There are many reasons why mutual funds are good. The benefits of mutual funds are described below.

Mutual Funds are regulated by SEBI:

SEBI (Securities and Exchange Board of India) ensures that investors follow the prescribed rules and government policy. The risk of loss is reduced by the decision of an experienced professional.

Diversification in Mutual Funds:

Mutual Funds invest in various types of assets such as stocks, bonds, and other securities. Diversification reduces the number of losses, thereby reducing the risk of poor performance investment in the same asset.

How to Invest directly in Mutual Funds?

If your KYC is complete, then you can make direct investments both online and offline. If you don’t feel like investing online, you can invest in the nearest branch if you want.

Investing in an online medium is the best way. You don’t have to pay any kind of commission. You can invest on the fund’s website or the RTA site.