Mutual Fund: A mutual fund is a pool of funds that is skillfully managed by a fund manager.
The fund manager collects money from a group of investors and invests it in a diversified portfolio of stocks, bonds, money market instruments, and other assets.
The performance of the mutual fund is reflected in its “Net Asset Value” (NAV), which determines the value of each unit.
Any income or profits generated from the investments, after deducting applicable costs and taxes, are distributed proportionally among the investors.
In straightforward terms, a mutual fund is a collective investment vehicle where funds from multiple investors with similar interests are pooled together.
Mutual Fund: How to invest in a mutual fund?
Option 1: To invest in mutual funds, an individual can complete an application form and submit it along with a cheque or bank draft at the branch office or designated Investor Service Centres (ISC) of the mutual fund, or through the registrar & transfer agents of the specific mutual funds, as per the prescribed procedure.
Option 2: The investor also has the option to invest in mutual funds through the official websites of the respective mutual funds using the online mode.
Option 3: Furthermore, an investor may choose to invest in mutual funds with the assistance of a registered Mutual Fund Distributor who is affiliated with AMFI (Association of Mutual Funds in India).
In this article, we will explore the process of investing in mutual funds through Zerodha’s platform – mf.zerodha.com, which is a stock brokerage firm.
Mutual Fund: Investing through Zerodha Coin
By utilizing the order collection platform Coin, you can conveniently invest in mutual funds online from various asset management firms without incurring any commission charges.
This app allows you to access all your mutual funds, equities, currencies, bonds, and other assets in one unified platform.
Benefits of Zerodha Coin
- You can invest directly in funds.
- The step-up SIP functionality allows you to automatically raise your SIP contribution by a specified percentage.
- You can compare one mutual fund with another.
- You can also view sectors and companies that fund house invests in.
Buy mutual funds through Zerodha: A step-by-step guidance
- First, go to the mutual fund platform mf.zerodha.com.
- Search for any fund.
- Analyse historical performance.
- Then click on ‘buy’ for a lump sum or one-time investment, and SIP (systematic investment plan) if you intend to invest small amounts of money at fixed intervals automatically.
- You are just one click away from buying any mutual fund after logging into the platform. To login use your trading (Kite) login ID and password.
It’s worth mentioning, especially for beginners, that unlike stocks which experience constant price fluctuations, the NAV (Net Asset Value) of mutual funds changes only once at the end of each trading day.
When placing orders to buy or redeem mutual fund units, they are generally executed based on the NAV price of the next trading day.
Zerodha fees
Like stock investments, mutual fund investment is also free on Zerodha.
