How to Invest in Mutual Funds?
Mutual funds investment can seem complicated, especially for first-time investors, as it can be confusing. However, the first step in your investment journey is to understand how mutual fund works.
Today, almost all the information about the working of mutual funds is readily available. But, to initiate your investments, you should also know the process of investing in mutual funds.
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Online Investment in Mutual Funds
Online investment in mutual funds is straightforward and can be done in one of the following ways:
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1. Official AMC Website
Every Asset Management Company has an active website where you can find multiple categories of Mutual Fund to invest. You can submit the required information by following the instructions on the fund house website.
You can also complete your KYC process online by providing your PAN and Aadhaar details. The information provided is then verified at the backend, and you can start investing upon successful verification.
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2. Mobile Application
The fund house also allows investors to invest in Mutual Funds through their mobile applications in a quick and hassle-free manner. The AMCs and third-party mutual fund aggregators provide a platform to invest in Mutual Funds through their mobile applications,
The app enables investors to invest in various schemes, buy or sell units, view account statements, and check other relevant details about their portfolios.
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Offline Investment in Mutual Funds
If you prefer the traditional route, you can opt to invest through the offline method. The offline mode requires you to physically fill in and submit the mutual fund application.
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The first step is to visit the nearest office of the Asset Management Company of the selected fund.
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You will be asked to complete your KYC (Know Your Customer) compliance procedure. You would be required to carry a few documents for in-person verification, including:
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- 1. Self-attested copy of your PAN Card
- 2. Self-attested copy of your address proof. It can be a copy of your Aadhar card, driving license, passport, latest electricity or telephone bill, latest bank passbook, bank account statement, or rent agreement.
- 3. You also need to submit a Common application form or SIP form. If you decide to take the SIP route, you will be required to fill out a NACH Mandate, which will give the fund house permission to automate the deduction of the SIP amount from your bank.
- 4. You must also submit a cheque or demand draft in the name of the AMC in case of a lumpsum investment. You will be allotted a folio number and an account statement for your investments once the transaction is initiated.
- Alternatively, you can also choose to invest via intermediaries like mutual fund distributors, registered investment advisors, stock market brokers or banks.
- As per SEBI Mutual Fund Regulations, all mutual fund distributors must fulfil the following two requirements before engaging in the sale and/or distribution of mutual fund products-
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- Obtain the relevant certification from the National Institute of Securities Management (NISM)
- Register with the Association of Mutual Funds in India (AMFI) and obtain AMFI Registration Number (ARN).
Conclusion
Today, Mutual Funds are considered one of the most lucrative alternatives to invest your money. Despite the availability of varied investment options available in the market, mutual funds are popular among investors for all the right reasons, including flexibility and professional management.
“Visit here https://licmf.info/KYCredressal to learn more about KYC requirements, SEBI Registered Mutual Funds and Grievance redressal.”
Disclaimer: The views expressed herein are based on internal data, publicly available information and other sources believed to be reliable. Any calculations made are approximations, meant as guidelines only, which you must confirm before relying on them. The information contained in this document is for general purposes only. The document is given in summary form and does not purport to be complete. The document does not have regard to specific investment objectives, financial situation and the particular needs of any specific person who may receive this document. The information / data herein alone are not sufficient and should not be used for the development or implementation of an investment strategy. The statements contained herein are based on our current views and involve known and unknown risk and uncertainties that could cause actual results, performance, or event to differ materially from those expressed or implied in such statements. Past performance may or may not be sustained in the future. LIC Mutual Fund Asset Management Ltd. / LIC Mutual Fund is not guaranteeing / offering / communicating any indicative yield on investment made in the scheme(s). Neither LIC Mutual Fund Asset Management Ltd. and LIC Mutual Fund (the fund) nor any person connected with them, accepts any liability arising from the use of this document. The recipients before acting on any information herein should make his/her/their own investigation and seek appropriate professional advice and shall alone be fully responsible / liable for any decision taken on the basis of information contained herein.
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