Let’s make this very clear. A broker is one who collects commission from the Mutual Fund company (i.e. producer). This money goes out of the you, the customer’s pocket.
By this definition, FundsIndia, Scripbox, ET Money are all brokers because they sell “Regular Plans” which take our commissions from your invested money and pass them on to the broker.
As a investor, you need to be aware of the commission that is taken each your from your invested money. Every year 1% to 1.5% means that over 20 years are giving away 30% to “40% of your money to the brokers.
Alternative? Direct Mutual Funds. Go with an online platform which is:
- 100% paperless – no signing of documents, couriering etc.
- eKYC with Aaadhar – onboarding new investors is digital too
- Super Convenient to use with Mobile App, Web App
- SIPs etc are easy to setup and unlimited
- Large selection of top Mutual Fund companies. Preferably 20+
- Safe with your money. One who doesn’t even touch your money!
Note: Many large brokers ‘pool’ money and then send it to the MF. - Helps with the tax filing reports at the end of the financial year.
- Growing by word of mouth and user experience.
Note: Many brokers make enough profits (at your cost) to spend aggressively on ads.
