Understanding Different commissions on Mutual funds

Today we will see how your commission is earned from mutual funds. This is important for a customer to know because based on this you can compensate your agents. Its important to understand what kind of advice you should demand from agents because they earn money out of your investments. You can decide if the advice given by your mutual fund agents is worth the money you are paying or not. Apart from this you should know how mutual funds compare with other financial products, I found out that over a long-term mutual funds are the most attractive products from commissions point of view, even better than ULIP’s and Endowment/MoneyBack policies. However in current scenario generally investors do not remain invested in one single financial products for long , so it might not be 100% true.

There are 3 components of commissions earned by Mutual Funds Agents

1) Commission from Client

This is the commission which customer pays to the agents for their service. It generally ranges from .5% – 2% . It should depend on the quality of advice your agent provides . This is the commission you will pay to agent every time you do the investment . After the abolision of entry loads, client has to compensate the agents directly. So if you invest Rs 10,000 per month and your agent charges commission @1% , he gets 1% of 10,000 = Rs 100 every month. This is the amount you have to pay agent apart from Rs 10,000 Investment.

2) Upfront Commission

Upfront commission is the commission paid by AMC (mutual funds company) to agent in the first year. The commission varies from one AMC to another and varies across different categories of mutual funds. Equity Mutual funds generally give higher upfront commissions,whereas debt funds give lower commissions. let us see an example of this commission; if upfront commission is 0.5% , and your SIP is Rs 10,000 per month , then upfront commission would be 0.5% of 10,000 = Rs 50 per month , ie : Rs 600 for 1st year . So even if you dont pay your agent any commission he will earn upfront commission from AMC .

3) Trail Commission

This commission is mostly hidden from general public. This is most important part of commissions and main earning of mutual funds agents in long run. Trail commission is the commission paid to agents by AMC in subsequent years. The most important point you should know is that trail commission is percentage of total AUM (total worth of customer) . So if your total Worth of investments in a particular year is Rs 10 lacs and trail commission is 0.5% . AMC will pay 0.5% of 10 lacs = Rs 5,000 to the agent. This is the commission paid to your agent out of your money, Its adjusted from NAV. Which means that if an agent has 100 clients who have Rs 10 lacs of investments (current worth , not investment) with an AMC, then total AUM (assets under management) of that agent is total worth of all the customers, which is Rs 10 lacs X 100 = Rs 10,00,00,000 (10 crores) . So he will get 0.5% of 10 crores = Rs 5 lacs .

So many Banks and very big agents who have AUM’s like 1,000 crores invested through them will earn 5 crores of income per year (0.5% trail commissions) . This is one of the big reasons why many agents entice customers to shift their current investments to them (Read this) . So now you know how ICICI , Kotak and other platforms which provide mutual funds investing through demat accounts make huge money. This is not to say if its right or wrong. Commissions are every where and you have to pay the price of transactions, It’s just to tell you how our commission on financial products are structured and how commissions from financial products make huge money in commissions. Most of the financial planners who make you invest through them also make good money out of the commissions over long run. This makes sense also most of the times because then they can service you better and track your investments every year properly .

Why it’s Important to know about Trail Commissions ?

For a client, its important to know about trail commission and other commissions, so that he is not a victim of Misselling , It might happen that your agent is pushing you to buy a mutual fund which pays higher Trail commission . For example Birla Sunlife can pay Trail commission up to 0.75% , where as SBI pays maximum 0.4% . That means agent will get much more trail commissions in later years if you buy Sun Birla Life Mutual funds from him, in which case he will try to encourage you to buy higher paying Trail commission products , irrespective of mutual funds which are suitable for you . As a customer knowing mutual funds commission structure will make sure you evaluate the whole situation and figure out if you are being mis-sold a mutual funds or not !! .

Also read : Agents Commission on Insurance Policies

Mutual Funds Commissions

Mutual Fund Company Asset Class Upfront Fee (Percentage) Trail Commission (Annual Percentage)
AIG Equity 0.40 0.40
AIG Debt 0.00 0.05 to 0.40
Birla Sunlife 0.40 to 1.75 0.20 to 0.75
Canara Robeco Equity 0.75 to 1.25 0.50 to 1.00
Canara Robeco Debt 0.00 to 1.00 0.25 to 1.00
Canara Robeco Liquid 0.00 0.05 to 0.40
Canara Robeco Guilt 0.50 0.50
DBS Cholamandalam Equity 0.75 to 2.75 0.40
DBS Cholamandalam ebt 0.00 to 1.00 0.10 to 0.35
DBS Cholamandalam Liquid 0.00 0.05 to 0.20
DBS Cholamandalam Gilt 0.00 0.40
Fidelity Mutual funds Equity 0.50 to 2.00 0.50 to 0.75
Fidelity Mutual funds Debt 0.00 to 1.25 0.10 to 0.50
Fidelity Mutual funds Liquid 0.00 0.05 to 0.30
Fidelity Mutual funds Gilt 0.50 0.00
HDFC Mutual Funds 0.50 to 0.90 0.20 to 0.80
ING Investment Equity 0.50 0.50
ING Investment Debt 0.00 to 0.75 0.10 to 0.30
ING Investment Liquid 0.00 0.05 to 0.20
ING Investment Gilt 1.00 0.00
IDFC 0.50 0.10 to 0.80
JM Financial 0.50 to 1.00 0.05 to 0.75
Kotak Mahindra 0.05 to 0.65 0.40 to 0.50
Mirae Asset 0.50 0.50
Principal Pnb Equity 0.65 to 3.25 0.40
Principal Pnb Debt 0.00 to 0.75 0.05 to 0.65
Principal Pnb Liquid 0.00 0.05 to 0.10
Principal Pnb Gilt 0.25 0.10
Quantum Mutual funds 0 0
Reliance Capital Equtiy 0.40 to 2.75 0.30 to 0.50
Reliance Capital Debt 0.00 to 0.90 0.05 to 0.75
Reliance Capital Liquid 0.00 0.05 to 0.35
Reliance Capital Gilt 0.00 0.50 to 0.60
SBI Mutual funds 0.40 0.40
Sundaram BNP Paribas 0.60 to 1.75 0.20 to 0.40
UTI 0.75 to 1.50 0.10 to 0.75
Edelweiss Equity 0.00 0.35 to 0.75
Edelweiss Debt 0.00 0.05 to 1.00
Edelweiss Liquid 0.00 0.05 to 0.20
Edelweiss Gilt 0.00 0.25
Franklin Templeton Equity 0.50 to 2.50 0.40
Franklin Templeton Liquid 0.00 0.05 to 0.35
Franklin Templeton Debt 0.00 to 0.80 0.05 to 0.60
Franklin Templeton FoF 0.30 to 0.50 0.25 to 0.38
HSBC Equtiy 0.00 to 0.50 0.40 to 0.50
HSBC Debt 0.00 to 0.80 0.05 to 0.60
HSBC Guilt 0.00 0.30
Morgan Stanley Equity 0.65 0.50
Morgan Stanley Debt 0.00 0.20 to 1.00


Source : FundsIndia.com


Here is a hypothetical example where an agent has single customer .

  • SIP per month : Rs 10,000
  • Commission paid to Agent by Customer : 1% (for every payment)
  • Upfront Commission paid to Agent by AMC : 0.5% (for First year)
  • Trail Commission paid to Agent by AMC : 0.5% (for subsequent years)

year Investment AUM (With 12% annual growth in Value)
Customer commission (1%)
AMC commission (Upfront & Trail = 0.5%) Total Commission (Customer + AMC)
1 120,000 0 1,200 600 (upfront) 1,800
2 120,000 134,400 1,200 672 1,872
3 120,000 284,928 1,200 1,425 2,625
4 120,000 453,519 1,200 2,268 3,468
5 120,000 642,342 1,200 3,212 4,412
6 120,000 853,823 1,200 4,269 5,469
7 120,000 1,090,681 1,200 5,453 6,653
8 120,000 1,355,963 1,200 6,780 7,980
9 120,000 1,653,079 1,200 8,265 9,465
10 120,000 1,985,848 1,200 9,929 11,129



  • Make sure you do not get carried away by the numbers alone , There are operational costs , taxes , overheads to service clients as well .
  • The clients will be liquidating their investments over the years and moving to other mutual funds or Agents , which might impact the commissions for agents.


You will see that the general perception that mutual funds product are very cheap products are not correct . Once a mutual funds builds a good client base who sticks to him , the commissions on mutual funds will be much more than Insurance .

332 CommentsAdd Comment

  1. Roopesh Majeti

    Really an eye-opener for the common investor and even seems lucrative for becoming MF agent. Iam thinking .. why not quit the IT job and become a good MF agent ? 😉
    Really a good one.

    • Roopesh

      Yes, good idea. however dont underestimate the skills and work involved in building a client base for that :) . Do you think its easy and exciting than an IT job ?


      • Roopesh Majeti

        I will definitely say YES.
        Atleast to my extent/knowledge.
        But YES, as you said… its little hard to get a huge client base, to complement IT salary. But an assured one, compared to attrition rate in INDIA :), once we achieve that client base.
        what you say ?

        • Roopesh

          Correct , as I said in the article , its tough to retain clients for many years in mutual funds . Also to make a shift from IT to finance you have to work in both the areas.


        • Sharath

          Quitting is Easy but did you think what you would when people would start investing online? What’s more, most funds are available for trading on the exchange. Have back up plans. And even after these considerations, you still plan to quit, how different are you going to be when compared to the others already in the business?

            • Amit Patel

              It is not necessary to get OWN ARN.
              After AMFI exam join MF broker (Karvy or Religare or else…. ) as a subbroker without any FEE.
              Always ask client to use ARN and subbroker code (paper transaction) provided by Broker.
              In case of Online user, ask client to use ARN and subbrokercode (must) and explain client that there is no loss to him.

              In case of difficult queries by client, ask Manish (Jagoinvestor) and show it to client online or explain personally :)
              Manish is a good guy and will never ask for money.
              As an IT professional I do have clients in my office only.
              No need to leave lucrative IT job.

      • नहीं मनीष ऐसा गुनाह में नहीं कर सकता मैंने सोचा पहले तुम्हारी लिस्ट पूरी कर दूं फिर असलियत कि बात करूँ | :)

        Let’s talk about your figures:

        A client saving Rs 120000 per year in Equity MF through SIP regularly for 20 years. (100 such client)
        India’s saving rate is 30% plus but less than 6% goes to Equity & close to 2% in Equity Mutual Funds.
        But this LUCKY agent keeps hitting bull’s-eye & gets clients who are willing to invest 50% of their savings in equity MF. According to this all his client earns more than Rs 800000 tax free.
        This lucky agent gets his 100 such clients on 1st day of business & all of them are ready to give him 1% as advisory fee. LOL (This will accommodate any other lump sum business he gets)

        Expenses: (40%)
        Service tax 10%
        Income Tax 1st 10 Years 10% & Next 10 years 20%
        Business Expense 1st 10 Years 20% & Next 10 years 10%

        Inflation 6%

        Year……… Gross Figure……. After Exp. & Inflation
        1st Year…… 180000…..….. 101000
        5th Year.….. 441000………. 194000
        10th year….. 1112000………. 359000
        15th year….. 2296000………. 544000
        20th Year ….. 4383000………. 763000

        So how many of you are still ready to leave your jobs & start as MF advisor?? :(

        Reform of fee structure hits Indian retail growth

        • Hemant

          thanks for putting detailed information, it makes sense , however we should also consider rise in investments from clients as their income increases over time .


          • Roopesh Majeti

            True said Manish. Also, the agent will not stop with the 100 target client base. Also, as you said, the investors will not stop with initial investment plan. They will increase it, in due course of time, with increase of hike in their salary.

            The reason why i said that we can shift from IT to MF advisor.. is that.. the MF agent can increase his salary [ commission ] by putting his extra efforts and increasing the client base…. whereas in IT, even though we work hard [ day-night ], we are not sure, whether we will get hikes or not [ due to recession or other factors ].. This is just on the funny side note :)

            • @ Roopesh

              Try to enter shoes of a Mutual Fund Advisor then you will realise managing more than 100 families is not possible for IFA. Kind of assumptions I have taken leaves little room for average IFA.

              In Manish example if we are talking about 20 Years. Say the Guy is Investing for Child Education/marriage or other long term goals including retirement. From where that money will come? Definitely from this Mutual Fund corpus.

              Secondly when client is moving closer to retirement he will be looking for safer heaven. He will be withdrawing from equities & moving to debt.

              The grass is always greener on the other side of the fence. :)

              • Yes

                I agree with you hemant , i should have included that thing as well . however the main point here was just to show people ,how much agents earn through trail commissions .


                • Manish, good professionals know that if an investor whose not savvy with finances & chooses to yet get decent returns – the only option available is the SIP route.

                  I think what your article (although well written) is missing is it’s one sided. Here are my thoughts,

                  Considering the flexibilities, charges, convenience does a retail customer have any better alternative.

                  You mentioned about trail commissions – have you ever thought about how many people discontinue their investments (after getting their financial planning done!)

                  If an agent is giving you good service & giving you timely information (that could in turn save you thousands if not millions) what’s the harm earning a revenue – The same people who crib about the charges paying one month rent (as commission) to a real estate broker who wouldn’t have even done 10% of the justice a IFA would have done.

                  What I’m getting at is, your articles must draw a balance as against just painting a negative image of the IFA’s

                  • Sharath

                    Yes , I accept that article was more on negative side , but the intention was to show that mutual funds are not the cheaper products compared to other products like traditional Insurance and ULIP’s . I am alreardy writing an article depicting the bad state of agents which is in favor of them , so in total I am not biased :)


                    • Agree Manish that they ain’t the cheapest. But when you consider long term investing, flexibility, convenience, diversification is something you cannot put a price tag to.

                      For example, lets say I invested in a traditional instrument for the last 10 years (premium being 50K pa). Now suddenly I’ve got an excellent real estate deal that is going real cheap or there’s a medical emergency to the tune of 5lacs or business loss (and I don’t want to get into loans) Would the traditional instrument (be it a money back, endowment, retirement plan) cater my immediate requirement. NO. But in the case of MF’s its completely different story altogether. One can not put a price tag to convenience, don’t you agree :-)

  2. Amit Sharma

    Simply superb research…BRAVO…hats off to u jahapanah…real eye opener….now v all hv a clear vision abt our financial products

    • Amit

      what do you think about these information research ? Most of the things like this is hidden from common public , if not hidden , its not clear to public most of the times . What do you say ?


      • pratik agarwal

        eagerly waiting for commission structure of insurance……

        my parents believe in LIC so much that they invest in insurance only apart from business.. so it may be eye opener for them that how much agent earns from them.

        Also I will like to point one thing about insurance here. Whenever we take any new insurance policy, agent re pays his first year premiums income in order to induce us for making policy with them.

        • Pratik

          Yea .. the reason is simple , he also earns from your in later years , so he wants you to go with him . Its like loosing first year premium (which is big) to gain all future premiums .


    • E Pradeep

      hmm.. Not sure . Though I think it should be less , there can be arguments about the costs involved . Not sure , what do you think ? Do you feel cheated ?


      • Chander Kant Goyal

        I have invested in many mutual fund directly, I do think the benefit of not having to pay trail commissions to broker should be passed on to the investor, This will attract more investors to invest directly with mutual fund houses, and more and more people will be saved from mis-selling of financial products. and may be one day we can create a mature market faster where trail commission can be abolished

        In my opinion the whole structure of brokers being paid by fund houses on the expense of investor’s pool of money instead of paid directly by investor and judged by market forces on the services provided is corrupt and flawed because it creates conflict of interests for a mutual fund advisor and prompt mis selling of financial products

        • Chander

          May be .. but not sure if removing the incentives of agents will really help mutual funds industry .. you and me might be mature investors who can find out info and do our investing , but a large chunk is not like that .. they need some one to push them for investing and agents do that .. without them it cant really flourish


          • Chander Goyal

            Hi Manish,
            a Mutual fund is pool of money of all the mature and immature investors,
            Don’t you think it is unfair to the investors who are investing directly with fund house to bear load of extravagant trail commissions as cost of aquiring /pushing not so informed investors?
            If SEBI rules allows, why can’t they offer some kind of rebate to direct investors, Why can’t fund house charge broker’s commisions from the investors account who are availing the services and not to pay them from the pool of money

              • Chander

                Finally SEBI has come up to protect close holes from investors money, with Direct plans
                AMCs are again indulge in unethical practice to hold back on auto switch to direct plan for direct investors, they have indeed tried to impound the options for jagruk investors by applying exit load on such switches and increasing the exit load in past few weeks

                I hope sebi intervenes again and apply auto switch to direct plans wef from 1st january itself

      • Hemant,

        I really like your responses. Let the customer know where the charges are & charge him for your time. No one likes a miser. As Robert Kiyosaki says, To get good advice, Pay your advisors well

    • Mitesh

      Yea .. You can say that , however you have to understand that while in ULIP and Endowment plans the costs are high upfront, in mutual funds it comes over a long period . Dont you think so ?

      Which one do you think has more charges is that case ?


      • mitesh

        I think so … manish canu elaborate in detail with example if possible ULIP charge compare to MF charge for 20 yrs.

        As i know no MF have fund performance for such long time. so if possible can u take example from US fund house (cause US is pionner in MF) so we can take MF from US for 20 yrs ….
        pl …

        @Hemant u like to help in this matter??(may be more intersting )

        • @ Mitesh

          Your question is not clear you are talking about expense or performance.

          If you are talking abt expense theoretically :( there is not much difference as maximum charge in ULIP will be 2.25 % above 10 years(Below 10 it’s 3%) in Mutual fund it’s
          First 100 Cr 2.5%
          Next 300 Cr 2.25%
          Next 300 Cr 2%
          After that 1.75%
          So for a fund size of Rs 1000 Cr this will be 2.05% & for Rs 1500 Cr fund this will be 1.95%

          Hope I clarify your question.

          On second Part where you are asking for research on US funds, I will love to do it.
          Who will pay for it you or Jagoinvestor. Deposit Rs :) :) :) :) in my bank account.

          :) I don’t work for money but I don’t work without money. :)

          • mitesh

            @Hemant i am talking on expence (charge) If i have run one Ulip plan for 20yrs and 1 mf (d.eqty fund) for 2oyrs. Who will be topper in expence ??

            Here i like to understand that if fund size is 1000CR charge is 2.05%, is yrly,mnthly, or weekly?

            i have mention US fund, becasue no Indian fund have such long time in market (max 10 yrs apprx)

            Is really if i Boght 1000 SIP for dv.Eqty fund for 20 yr or 30 yr at the end of 20 or 30 yr i will get annuliez return more then 15% or more .. .

            Aree bhai its just matter of sharing ….i think manish is doing g8 job here… without charging and without asking to deposit amount is bank toooo…is it….g8

            Hemant you are FM and manish Toooo…?

            • @ Mitesh

              I think I have cleared your question on expense part, from MF it’s daily adjusted from NAV but in Insurance it’s “baap ka raaj…. Jab marji ayegi tab utna kaat lenge”

              Mitesh in India there are funds which are close to 17-20 years old(even after excluding UTI funds) SBI Magnum Equity 1990 (16.74%) SBI Magnum Multiplier Plus 1993 (15.38%) Franklin Bluechip 1993(26.34%) Franklin Prima 1993(22.13%) There are lot of funds which are there from last 15 years including HDFC, Tata, Reliance.
              In brackets it’s since inception performance of these funds but Past performance may or may not be sustained in future.

              As you asked to compare US funds expenses/performance it’s not logical to do that. Why? Read extracts from speech of Mr Gautam Chikermane(Editor Hindustan Times) – World First Financial Planning Summit 21 April 2010 – Taipei

              “I found that the commission a planner gets by selling an insurance product ranges from nil in Hong Kong and 40 per cent in India to 100 per cent in Brazil and 120 per cent in Australia. For mutual funds, the commissions range from nil in India to 100 per cent in Brazil and Australia. Barring China and India, all said that planners have the option of not charging a commission and collecting fees or charges from consumers.”


              “These are costs that need to be exterminated. Note, I’m not saying “reduced”, but “exterminated”. In this respect, India has provided a lead by turning all mutual fund sales no-load. That is, no commissions if you sell a mutual fund in India. And while the insurance regulator in India is dragging its feet, beginning 2013, all products in the UK, including insurance, will go no-load. Like it or not, one country after another is going to go the no-load way, one product at a time. To rephrase Peter Drucker, no-load is a future that has already happened. To fight it would be to shoot bullets at air.”

              Before tide turns (hopefully in 2012) start searching for a good planner/advisor for you:


              No comparison with Manish… Hats off to him.

              Have you read my guest post on this blog?


              • Hemant

                I feel there was exageration in displaying the commission structure , I have reduced it to just 10 yrs and included a note that there will also be overheads for operation and costs involved . I hope that will make up .


              • mitesh

                Thanks Hemant & Manish,

                I think if some one sale somthing and he not get from that, i think no will work for that. (even u too mention here)

                Really what is need and what we get ?

                If u see around us insurance agents so so many but MF ….

                Insurance agent get smart enought to spare time for work as agent.

                even in all products insurance, ULIP, MF ??

                so what is the best product for normal investor ?

  3. amol s

    in that case bringing 100’s people to invest in MF is more profitable than buying mutual fund itself.
    Not happy with trailing commission part that they get. A commissions from buyer and then upfront commission is enough for them. AMC can use the trailing commission for NAV promotion.
    Now a days agents will tell your the list of mutual funds to invest by seeing them on popular website(by picking all 5 star rated MF) that anyone can do and at the end call it as great service delivered.

    What happens to upfront commission if we invest directly ? I think, it goes to AMC’s pocket.

    • Amol

      Good question . I am not sure on upfront commission , but I think just like Trail , it should be getting deducted from NAV and pocketed :) . Dont you think removal of trail commission totally will lead to collapse of Distribution channels ?


          • NKanani

            Thank you Manish, for the detailed article on commission structure. From the way it looks, it is like ‘Royalty’ being paid to the agents (as % of AUM), instead, it would be more preferable (from investor’s perspective) to pay (trail) commissions based on % of actual investment being made. This would ensure that agents would ask investors to continue their SIPs and whatever – in turn adding investments and then, eventually increasing returns (to investor). After all, it is the investor’s money which is getting invested, so, more the return to investor, the better (ethically). If any ‘Royalty’ is to be paid, it is the investor who should deserve that. (My personal opinion – many may not agree).

  4. Saurabh

    I think AMC’s charges approx 2.5 % annualy from Clients. This includes all the charges such as Fund management charges, Marketing/ Selling expenses, Audit fees, Trail Commisions etc. So thats fine and much less compared to ULIP’s. Am I correct ?

    • Saurabh

      no , you are not .. The charges may be different for AMC’s , also in ULIP’s and endowments , the commissions depend on Premium , so there is no compounding effect . here in MF , the trail is computed on AUM , which increases over time and over a long term it can really be very big , so it will he higher . Do you get it ?


    • @ Sourabh

      You are right AMC charges maximum 2.5% as overall charges in case of Equity Funds.(.25% lower in case of debt)
      There is a slab system (depending on the AUM in the Fund)

      First 100 Cr 2.5%
      Next 300 Cr 2.25%
      Next 300 Cr 2%
      After that 1.75%

  5. yogesh

    Good Article.Really Nice information.

    Atleast now if we buy MF from agent can ask him to skip
    taking commission from us.

    • Yogesh

      No , thats not correct, Trail is what he does not control , tomm is things change what will an agent do , also if he services you well and gives you excellent guidence, you should pay him good commission , I wont mind 2% also .


  6. Jagbir

    Very good information presented in really simple way for everybody. Seems it make more sense that you should go directly with AMC or sites which at least doesn’t charge any service charges like fundsindia.com. I found ICICIDirect quite expensive for SIP activity. what you say?

        • Kunal

          Hemant But
          we can go through online portals like fundindia to save the entry load at least
          what is harm in that.
          do we need to consult doctor for this purpose also?

      • Kunal and Jagbir

        the point is very simple . demand good advice from the agent from which you are buying funds , If you can get any agent like that then you have no choice but to go with some distributor who does it for free , he will make the trail and upfront no matter what you do .


  7. Sachin

    If I have already taken ULIPs and have paid all the commissions and charges, I think it would be better if I top up in existing ULIPs than investing in MFs. I think for investment horizon of 10 years or more, ULIPs are better. Of course, ULIPs are not flexible. You can change a MF if you do not like its performance.

    It is true; there are no free lunches. But at least you should get a decent meal for what you pay.

  8. Kunal

    I manish

    i have a question here
    I have invested in Reliance Natural Resources Fund from Nov2008
    and as per Sebi entry load is removed from Aug 2009
    but in my account statement i still noticed that they are charging around 2.2% load charges.
    can you explain me why it is so. should i need to restart my SIP to remove this load.

    • @ Kunal

      This is misselling on part of your agent(He is hiding information). He would have told you that…..
      Yes you should stop your SIP & restart it again. Decide what fees you want to pay to your distributor.

    • Nilesh Panchal

      Hi Kunal,

      As per SEBI Rule wef 1st August 2009, Entry Load on Mutual Funds is removed. But those SIPs running before this date will attract the Entry Load as like in previuos case. So to get the benefit you will have to stop your SIP and reregister. This information your agent should have told you.

      So now immediatly stop your old SIP and register a new SIP to take the benefit.

  9. Pavan

    Interesting article ! I used to wonder what motivates agents to still sell mutual fund if the client is not ready to pay any commision ! This makes it pretty clear !

  10. aditya


    Not sure, if I have understood clearly. From the Fund houses perspective, they cant do it for free right! Also commissions is the mode for them to grab more customers Via brokers reach. I am unable to realize, as a MF investor, what are the other avenues to pay service fees to the individual and orgs who maintains my portfolio with acceptable returns of inflation +~6-8 percent per annum?


      • aditya

        Hey Manish,

        I am asking as a MF investor, how do I compensate fund houses( given the new SEBI rule of zero entry charges) . In other words, how does MF houses make money for their services?

        Trail commission might be an established way of doing business perhaps..


  11. Sunil Date

    All of you who think that the MF agent or the Insurance agent is ripping you off, have wondered about ?
    1 How much commission does your kiraNawalaa get ?
    2 How much commission does Big bazaar, shoppers stop, Kroma get ?
    3 How much is the brand cost and how much is product cost in a arrow shirt, a Rebock shoe, a Cocacola etc
    4 How much do AB, SRK, Kareena, Aishwarya, rip you off when you buy a product endorsed by them ?
    5 How much is your doctor / lawyer / CA charging you & whether it is justified ?
    6 How much are you ripped off by the actor or actress,when you buy a ticket for a movie ? They may not be even graduates but you who are graduates / MBA/ etc contribute to their cool Cr benevolent fund !!!
    8 Would you not prefer to hire a agent for your driving license work, RTO related work, passport related work ? You are happy to shell out whatever they ask; no negotiations !.

    Pl be reasonable & pay the servicer for the service they give. Don’t lynch the whole community just because there are a few bunch of crooks.

    • Pravin


      What is ‘reasonable’ service is debatable.The only person who can decide is the buyer of the service. If they dont want to negotiate on their grocery bill or doctors bill or RTO agent bill,it is not the service providers problem. If the buyer thinks he doesnt want the MF guy to get such a lavish compensation,then it is his prerogative.The customer is king.ALWAYS.

    • Sunil

      More than cribbing, this is more of an awareness article , I myself support for the trails provided customers get the value from the agent , but majority of agents , do they deserve any money for the kind of work they do ?

      Once customers understand the commission structure it would help them in understand what they are worth of and then choose better agents, its like survival of the fittest in advisory business and that will happen only when clients are made aware of this .

      I would say if an agents gives excellent services to clients , maintain and track their investments also they they should charge 2% commission from clients and then even 1% trail is also fine .


    • Chander Kant Goyal

      I would say, not the commissions are bad, but they way in which fund houses are forcing the charges on the investors by deducting it from NAV, instead of letting investors pay for advisor’s services by themselves on their discretion ,

      I am investing with mutual funds directly on there websites, I still have to bear the cost of trail commissions(in form of higher expense ratios) paid by MF house to brokers which they commit ed to acquire less financially aware investors

  12. rohit

    now I know why my agent was so much polite to me even after opening the mF & later also

    this is an eye opener

    manish , please throw lights on the AUM charges also , is it the same as expense ratio or more than that , which is borne by the investor

    • @ Rohit

      AMC charges maximum 2.5% as overall charges in case of Equity Funds.(.25% lower in case of debt)
      There is a slab system (depending on the AUM in the Fund)

      First 100 Cr 2.5%
      Next 300 Cr 2.25%
      Next 300 Cr 2%
      After that 1.75%

      • sandeep garg

        1) The % shown, are they same as expense ratio ?
        2) This additional trail/1st time commission is to be added to this expense or its inclusive in this ?

        Some ULIPs typically 15+ yrs are charging only upto 1.65% (8.35% returns on 10% scenario) including all charges, so looking at above in a way MFs may come costly in long run.

        I was actually talking to a finanacial planned few days back to make investements and their argument to go in a particular ULIP vs MF was MFs charge more in long run and ULIPs less looking at the illustrations it seems to be true. Any thoughts esp in perspective of long term investment 15+ yrs. MFs or ULIPs ?

        • Sandeep

          From long term perspective , Mutual funds pay more commissions to an agent, however thats not the only thing you can look for , simplicity of the product is what is important, where MF score well .


        • @ Sandeep

          They may be right theoritically but nor practically. (Only in some case as you have mentioned but normally the expense in ulip is 2.25% in 15 years)

          Sandeep think you got 2 job offers
          A: 5 Lakh in 1st year & this will increase by 1 Lakh every year for next 10 years. (But you will be fired if you will not perform your duties)
          B: Rs 60 Lakh in 1st year, 10 Lakh in second year & 1 lakh thereafter every year. (You can leave the job any time after 1st year, company will not ask to repay the salary)

          1st is Mutual Fund Agent & Second is Insurance Agent.


  13. MG

    Friends, My question :
    Other than the commission and loads, does anyone know if there is any other way
    1) Mutual Fund companies is making money by fooling the innocent customers ?….
    2)Anyone know if the NAV declared by Mutual Fund companies is transparent or not ??.. 3)Does Dividend declared by the Individual Stocks is given back to the Customers properly ?…
    4)Do we know if Mutual Fund companies deduct any money for paying taxes, sebi fees if any etc directly from customer ?

  14. Kunal

    Hi manish

    i want to know that the mutual fund return say since inception is 34 % in case of HDFC top 200 . so is it the return after excluding all trailing commission and fund management charges etc. or all these are inclusive to this return it means in the end investor get less then 34% .

    just for understanding purpose.

  15. gopal

    Hi manish,
    you are really doing a great job by making common man aware of various financial structures and also the hidden incentives behind selling the products. This article really help an individual / corporate wise take decision independently while investing their funds into MFs / debt funds. Thank you for all the info.

  16. Nitin Gupta

    Hi manish,

    I think, this is one of the best articles about mutual funds among all that i have seen.
    I think, there should be more transparancy about these commisions, and all the commisions should be presented in bold letters whenever any one buys a MF, then its up to buyer that he finds it worth or not.

  17. Prashant

    Hi Manish,
    Thanks for sharing the important hidden knowledge which should know as a buyer and I think it should also a factor for selecting a MF to invest, shouldn’t it?

    • Prashant

      The information here is more from awareness point and not attacking agents for this. You should know how much agent makes from you and how he can manipulate your decisions in buying mutual funds .


  18. Friends,

    Why focus only on the remuneration part? What about duties and responsibilities part?

    If the regulators (of all shades) implement the regulations they make, then 99% of intermediaries would vanish from the scene because the cost benefit would not work in favour of the intermediaries. Intermediaries of all kinds are flourishing in the trade because the regulators are not performing their duties (how many intermediaries are punished for the wrong doings?).

    -buyer wants almost everything for free and expects to get multi-bagger advice for peanuts
    -intermediary wants to hide all relevant information from the investor so that she can profit out of ignorance
    -regulator does not implement the rules he makes

    (exceptions exist)

    You see how sc****d up the is the system for advisor who wants to make a honest living (like every one else – LOL)!

    Just look at two simple regulations from the authorities:

    If an intermediary has perform her duties and responsibilities both in intent and practice, then she will never undersell herself. If the investor know what ‘value’ she must derive out of the process, then she will never underpay the intermediary for she will then be aware of the pitfalls of sham advice. As usual, reality seems to point elsewhere.

    • Narendra

      Nice points . I will go through the links in details. Do you think there will be no commission structure in india in coming few years as suggested by swaroop commission ? If that happens how will the industry survive ?


      • Manish,

        In the retail space already two regulators have banished entry loads out of which only mutual fund industry is providing wafer thin commission. IRDA might fall in line sooner or later.

        The effect of these changes is already felt by all. Number of NPS accounts being opened are horribly low and there is -ve collection in mutual funds (excepting corporate money). So the changes have failed and the sufferer is retail investor who will most likely look at bank fixed deposits – one product that she understands well – for wealth creation. There is no significant traction by the reail investors through direct/walk in channels of mutual funds. Products meant for retail participation would remain highly under-subscribed without intermediation because these are not demand-pull products but supply-push types. Take a poll to see how many of your readers are implementing what they learn here. I am sure it will not be many in number. Otherwise, it will be very easy for all fund houses – find an evangelist such as Manish and business would flow!

        As and when IRDA follows suit, the same thing will happen there also. Most of the 4 million intermediaries would have to make good with other options to survive.

        So it will be financial planners/wealth managers for HNIs and for the rest it has to be
        ‘do-it-yourself’. If some one is thinking of taking up financial intermediation, it is time to do a reality-check. Becuase, if IRDA falls in line, the first victim would be the trail commission on mutual funds because of level playing field demand.

        It is only then, the new set of intermediaries / regulations would emerge. In any developed country an insurance contract would be 1 inch or 2 inches thick. And the intermediary has to cross all t’s and dot all i’s sitting with the client. In my thinking, we are moving towards the same direction.

        • Narendra

          I have included the poll to really find how many readers are actually implementing the learnings , personally i know many who have been doing , however lets see the total percentage , that will be an interesting thing to do .

          Overall from your comments , I didnt find the final conclusion on “is it a good idea to move to no-load no-commission structure in our country” ?


          • Manish,

            In my opinion, this move is not good because

            a) India is not even a reasonably advanced capitalistic economy where price discovery of products and services happens transparently; we as a society are still feudalistic and our attitude towards money is majorly socialistic.
            b) Psychology of the investor against unbundling of costs and benefits.
            c) Regulator’s inability to punish wrong doers
            d) Shallowness of the market

            It would be better if two classes of products are available, one with load and another without load. This coupled with good disclosure norms should work. However, this seems to be a wishful thinking at this juncture because some of the regulators want to leap-frog decades of learning curve.

            To curb mis-selling, if loads are removed, then no selling occurs. Punishment is right answer for mis-selling. And mis-selling is not a one way street if you consdier the whole market. For bribery, there is both supply and demand side and so is in mis-selling. Even in the scenario where no-entry loads are there, mis-selling can occur because quality of the product is transient and not in the control of intermediary and investor. Dont we have fake drugs in the market?

            • Narendra

              I understand you points and very much agree to it , so what is the best solution from you which can help agents , insurance business as well as investors ?

              Just not reducing the commissions because of the a) b) c) d) points you mentioned looks fine ? Considering you are the regulator what are your suggestions to improve this whole problem , Can you give a comparision vis-a-vis other countries , I know asian countries have no commissions , where as australia and brazil have obscene amount of commissions .


              • Narendra N Kondajji

                1. Regulators are converting all agents to advisors but have not thought of increasing the entry barrier or retraining the existing ones. Current situation is that one can get trained as compounder and practice as a doctor and the smart investor pays to doctors as compounders! Licences can be procured with ease and there is no audit and no punishment for wrong doing. This must change. The regulator must also insist on the duties and responsibilities; only then the intermediary would be serious on the whole thing and the investor would benefit because of credible advice.
                2. Whether we like it or not the regulators are removing all embedded charges. So the writing on the wall is that there are going to be no agents of the manufacturers any more. Agents would be of the investors. Naturally the remuneration has to be paid by the investor. If some back-end payment remains, the investor would be still hesitant to pay. So it is desirable that any kind of payment by the product manufacturers to the advisors is stopped totally. As I mentioned earlier, this will still not stop someone mis-selling but it will be known as mis-buying then on. This requires redoing the legislations/regulations because today there is no regulation for advisory services in retail space. If the regulators were to persist with ‘product selling’ type of agency structure, then he must enable ‘with load’ and ‘without load’ products. T
                3. Comparing the existing situation in various countries is time consuming and costly exercise and I do not have any ready data on this.
                4. I still stand by my stand that majority of the investment products are supply-push products and in such cases removal of embedded costs does not make the people go for it. It is only saving related product that get consumed without going through selling process. Regulator can only change regulations and not the mind-set of the people. It is the intermediary who does this job. There are several examples to prove this point. The regulatory change in mutual fund industry is almost killing the industry, New Pension Scheme is a non starter and insurance is next in the line. In all this, the victim is the investor; over a period of time, you will see a flood of non-regulated or loosely regulated products chasing the investor’s money. I will be glad if my thinking is wrong.

  19. @ All Readers

    I think readers have taken Manish article in the wrong sense….

    Manish has beautifully explained different type of commission/fees agent/advisor get.

    I think learning from the article should be:
    • The kind of transparency your agent is having.
    • Is he regularly churning your portfolio to make extra bucks?
    • What is the level of Service & advice you are getting in comparison of fee or commission agent is getting.
    • And the most important – is he advising those schemes where he is getting more commission. You are having the right to know what exactly he is earning on funds that he is recommending + all the other schemes that he is dealing in. So if he is recommending Tata xyz fund you can ask what you are getting in HDFC abc fund.

    @ Manish what’s ur take.

    • Hemant

      Definately . Looks like most of the readers have taken the article with a different motive (mostly because of the way I put it , my bad) .

      they should take it more of “customers should know this stuff” and not “This is to rip off the agents” .


  20. Abhishek Singh

    Gr8 work Manish , I am a MBA student planning to make career as wealth manager.Also thinking of getting AMFI certification , so that I can become a mutual fund advisor.I think its going to be a good caree for me .If you could give me any advise on how to start advisory servicess that will be a gr8 help.Thanks!

    • Friends,

      Some of the projections are far far away from reality. Empirically, I can say that an average investor stays invested in mutual funds for less than 5 years and similarly in investment linked insurance products. So the fanciful trail etc. are just a mirage. As the saying goes, other side always appears greener. One has to be a person with empathy for the client to survive and prosper in this industry. Market forces work here as well folks.


      • Narendra

        You are right . I feel I have put examples with extreme thoughts, I have made the correction in the article and only put the example for 10 yrs , with extra notes saying that there will be overhead in servicing the clients and there are business costs too . overall the article should have been taken as the awareness article and to know how agents can missell because of difference in trail commissions .


  21. Mayank Jain

    Hi Manish
    I have recently started reading ur blog and finding it very informative and useful.
    I have a small question for u …out of context from this post though…
    I am planning to buy a house in next one year…i save 40000 Rs per month which i want to keep investing for next one year so that i get it back when i am buying the house.
    could you please suggest the best possible way to do that… is recurring deposit ok…wat are the pro’s and cons of it??

    • Mayank Jain

      Yes , RD will be a good choice for this , as this is an important goal and liquidity and safety are most important , RD will work out best .

      Make sure your maturity date for RD is alligned by your purchase date .


  22. dr kishan

    nice revealing article. but i think there is something wrong in the calculation of the hypothetical situation with a single customer with an agent who is depositing 10000 per month in sip
    i think the actual calculation is as follows
    at the end of first year total investment made : 120000, direct commission paid(@1%): 1200; upfront commission obtained thru amc(@0.5%): 600. thus total commission is 1200+600= 1800 (ur total).
    at the end of second year another 120000 has been invested by client thus rs 1200 as direct commission and 600 as upfront commission (for second year’s investment) and also the 672(trail commission over 1st year’s investment)(as u mentioned). that is a total of 2472 as second years commission and total of 4272 (2472 + 1800) in two years ie 1.78%(4272/240000 * 100).
    similarly u have to add the upfront commission of rs 600 for every running year in ur calculation
    even if the client with draws money in 5 years the commission which the agent gets from a single client is about 2.75 percent
    now it is the client’s discretion whether he is getting the services worth 2.75% in 5 years or not.
    even a single payment of one lac one time for five years would also give 0.5 % upfront commission(=rs 500) and trail comm of rs 500 (@0.5%) for 4 years = rs 2500 (that too not including the growth of AUM)
    it simply means that for a single one time investment too the client is paying about 2.5-3.0 % in 5 years (only thru AMC). should we still pay direct commissions to agents.
    paying the fees to financial advisors is surely justified who can use their expertise to help us in planning out our finances. but is paying to plain agents more than this (upfront + trail) justified? i doubt.
    i dont mean to offend anybody please pardon me if i have.

    one last thing i got from fundsindia.com for those who didn’t know: calculation of NAV:

    {market(or fair) value of scheme’s investments (plus) receivables (plus) accrued income (plus) other assets (minus) accrued expenses (minus) payables (minus) other liabilities}
    {no of units outstanding}.
    i think the commission to agents is paid from the “payables” section.
    this is my small contribution towards ur blog manish. hope i was of some help. please correct me if i’m wrong anywhere.

    dr kishan

    • dr kishan

      Upfront commission is paid only in 1st year . After that trail commission is paid , no upfront :) , so my calculation is correct.

      I am not sure how NAV is calculated exactly , may be Narendra or Srikanth from FundsIndia would like to point that out .


  23. As told by Hemant Beniwal the AMC’s charges are

    First 100 Cr 2.5%
    Next 300 Cr 2.25%
    Next 300 Cr 2%
    After that 1.75%

    So the agents wiil get their trail commission only from this. The AMC is not deducting any extra amount from our NAV na!!! Let the agents get their trail commission as they had their own expenses na. If there is no trail commission that amount will go to AMC but however it will be deducted from your NAV and unlike ULIP you can switch a MF very easily and while switching it may be through a new agent(may be you moved to another city).

    But you must be skeptical if your agent advises you to switch from a performing fund to any other fund (performing or non-performing) where his hidden agenda is to get a high trial commission :)

    95% of the so called financial planners or advisors who sell ULIP’s (note: only ULIP’s) coming directly to your home or office are just now passed MBA’s (who don’t know anything about financial planning) and they will get immediate upfront commission when they sell a ULIP, and 75% of them will leave that field in two years. So if you are investing in a MF through an (single) agent for 10 years then he’s worth to get that (trail) commission.

    • dr kishan

      but every time u sell a n equty based MF there will be STT being cut from the NAV itself. this is around 0.25%. may be manish or hemant can throw some light over this issue.
      dr kishan

    • Saurabh

      I still didnt get it.

      Praveen is saying AMC’s can charge us only 2.5 % that is including Trail commission. And Manish is denying. Which one is correct?

    • @ Praveen

      I agree With You.

      @ Sourabh

      Praveen is right & manish have mentioned it somewhere in comments.

      @ Dr Kishan
      Why do you need to sell your funds that frequently.
      Timing the market is worst strategy.
      If it’s asset allocation rebalancing it will be very small part of portfolio.
      If it’s buy & hold strategey you don’t need to sell anything.

      If you are not convinced with any particular fund & you want to change it. Even in this case you will be selling 15-20% of your portfolio in 3-5 years.

      • dr kishan

        i am not asking to trade frequently. i too am against it. i just want to clarify to praveen that frequent trading will lead to a loss of STT to the tune of 0.25%. this is done when trading equity based MFs. this is over and above the expense ratio. that is as i understand the system. correct me if i am wrong. thanks

        dr kishan

  24. Manish

    Nice article and illustrations.

    Before this, when an agent says that he would handle my investments without any commisions…I used to think he is trying to dupe me.

    Now, I understand that he is just letting go of the ‘customer commission’ and not all his commisions!

  25. Good News for all of us. :)

    AMFI proposes ratings for distributors

    In a wide-ranging interview, Mr. H N Sinor, CEO, AMFI said that AMFI is proposing to set up a rating mechanism for all distributors – from level 1 (basic) to level 5 (CPA/CFA or equivalent – who is qualified to advice on complex products) and then let investors decide what level of sophistication they need from the distributor / advisor. An HNI may opt for a level 4 or level 5 advisor while a retail investor may be satisfied with a level 1 or 2 advisor, since his needs are less complex. This is part of the move, in conjunction with SEBI, to segregate ARN examinations from a more comprehensive certification program for distributors.

    • dr kishan

      this is really encouraging. the gov is now trying to differentiate b/w agents and advisors. the picture shall be more clear for the consumers. in villages and towns even the compounders call themselves as doctors. but when the degrees are sought they are caught. similarly the agents now will not be able to befool the customers as advisors. am i correct?
      what u say manish?

  26. uk

    Please let me known how this will affect an individual if he invests directly through a Registrar like CAMS, Karvy

  27. india


    I am also in IT. what i was thinking is…
    can i become a mutual fund agent and manage my investments?
    Is it possible?
    In that case will i get the commissions on investment made on my own?

  28. arkad

    It is bad that I don’t get upfront and trail commissions If I invested directly to AMC. SEBI should change this. Because I did the whole work and decided on the mutual fund to buy. Instead of to the agents/AMC, upfront and trail comms should go to investors if they invested directly. At least sharing the comms 50:50 should be considered. They avoid paying it in the name of fund promotion. It sucks really.
    SEBI is showing in public that it is doing so many things to unit holders, but it is not doing. It is not even properly inspecting whether every transaction of all funds mutual funds are as per their normal investment objective and methods specified in OD.

      • arkad

        If they truly care about unit holders, they can have as many fees structures as they need. There can be wide variety of fees structures based on invested time period, amount invested etc. There are wide variety of fees structures for credit cards and all kinds of loans.

  29. arkad

    Considering the fact that unit holders work as more genuine ad/marketing/agent person than real ad/marketing/agent person, it is even more dubious what mutual funds are doing. I think it is better to invest in AMC stocks. Franklin Resources Inc(parent of franklin templeton india) is the fastest growing large cap company in America in the last 30 to 40years. They are not only eating their usual fees, but also eating fees that should genuinely come to us.

  30. arkad

    At least they should share half of it. I think there are more ways than these fees through which AMCs can earn their revenues if we go through the history of mutual fund scams in the world. I found out a violation of common investment method described in OD of an Indian mutual fund. Because of unforeseen future problems, I don’t want to reveal it. They replied without any proper answer to my question. I think if we read the investment method and track their investments every month/quarter, we can find violations if the investment method is trackable. Knowledgeable unit holders can make their life difficult.

  31. Sharath

    hi ,
    I came across this blog on mint.I am a new investor and found this blog a good read and very informative.
    Regarding commissions ,the SEBI has blocked the AMC from giving commisions to the agents. So now if I invest in mutual funds through an agent will they still get trail commission from the AMC. And if no, if I go without an agent to an AMC, will that save my money as I am taking the agent completely out of picture.

  32. Anand

    If I pass the AMFI exam, obtani a ARN code and register with the AMCs can I pocket my own trail commission. I am making DIRECT application to the AMCs of late. I am not kidding… the exam material is not too difficult and 0.5% in the long run really adds up.

    Any input?

      • Anand

        Manish – I went all ahead and even registered for the NISM exam. However on reviewing the AMFI exam material :-) it says that SEBI has barred distributors pocketing their own trail commissions. So guess I have to make my wife invest 😉 with my ARN code when I get one in a few days!

        I dont intend to do any marketing that I am a MF distributor this is just a means to reclaim my own money that will otherwise be swallowed as trail. Well I have to show this as other income in my ITR so I am just about fine perhaps!

  33. Saurabh Aggarwal

    Hi , you have written in your article over long period more commission is charged , so if i invest directly & save agent commission lets say 1 % , will it be able to make huge impact ? Would love to have an illustration to support.Thanks.

    • Saurabh

      Actually it will make an impact , but not that huge , because its on amount paid and not on the Worth . I would encourage you to do the calculations in excel your self .


  34. Nice artical. Very Informative. Thanks for sharing. Even you can get regular updates on Mutual Fund like Compare Funds , Latest NAV , Top Gainers , Mutual Fund Happenings and many more. To read more you can refer to:
    Dalal Street Investment Journal

  35. Saurabh Aggarwal

    Hi , I recently went to HDFC bank to get information regarding sip & their executive said the bank is not charging any entry load , which is ban , and they are not even charging any other fee if i do sip through them in any fund , even though i have got neither saving or any other dealing with them . So would like to know can there be any catch ? Just one thing after coming back executive called & was explaining some great nfo & ulips , which i politely declined , all thanks to your great blog , please suggest what should i do , should i do sip through them ?

    • If they are saying that they dont have any charges , it can happen , as they will earn from AMC around .5% , and then every year they will earn some percentage . So you just have to check if their is any fixed charges from them or not . You can go through them . Shouldnt be an issue .


  36. Satyanarayana


    Very nice information about expenses in MFs.
    1. MFs Vs ULIPs. MFs giving 15+% annualized returns. Where as ULIPs giving 8%. These returns after deducting the expenses.
    2. MFs gives the flexibility to change to another MF if performance is not as expected. But incase of ULIPs, customer have to bear much expenses for agent.
    Hence i would say that MFs are very good to invest for the origon of 3 to 5 years. Later we can move to new MF which gives good returns.

    Appreciate your comments.

    • Satyanarayana

      Return potential of ULIP’s and Mutual funds can be very much same , it depend on how the fund manager performs , ULIP’s will underperform because of the cost involved .


  37. Raghuveer Koppikar


    Can I (being resident individual) invest in Funds domiciled abroad, also these funds would be investing in foreign equities. Is it permissible to invest in such funds? How can i make the remittance?

      • Raghuveer

        No. I am Indian national and residing in India but want to invest in a mutual fund which is not originating in India and investing in foreign equities.

        • ok

          I dont think you can do that , you are allowed to invest in foreign equities through some brokers like ICICIDirect , but not sure about mutual funds .

          If you want to invest in foreign equities, you choose indian mutual funds which invest abroad .


  38. Wow: I thought before reading this article that only management expenses are deducted in subsequent years in case of mutual funds, but I am surprised to know that what a high expenses are involved in case of MFs too. It means it is not less expensive than insurance/ULIP products.

    • Raman

      Yes , but understand the expenses in terms of tenure also , in ULIPS , they are front loaded with charges based on premium . In mutual funds its spread over the year equally by percentage terms but on AUM and not on your invested amount .


  39. Sunil

    Hello Manish,

    I started 2 SIPs from an agent who is my neighbour. He did not charge anything. So I would assume he must have got the ‘Upfront Commission’ which is one time.

    But what is not clear is whether the fund house will deduct upfront commision from ‘my SIP amount’ since I have not come directly to them?

    Trailing commissions are anyway not avoidable.

    I am planning to start few more SIPs. So confused as whether, I should open it online or go via agent.



      • Sunil

        Thanks Manish.

        So the way I understand, if the agent is not charging you seperately for the service then it really doesn’t matter if you apply Directly or Online web portal (Ex: fundsindia) or Agent or other broker (Ex:Sharekhan).

        Am I correct?



        • Yes

          But also see the service , like if you invest through FundsIndia, you get access to their platform where you can see reports , track your investments , do things like alert based selling etc .

          So you are getting value by paying nothing :)


          • Siva


            Manish rightly pointed about Fundsindia. You pay nothing for enjoying their host of services and innovative investment tools. The Trail and Upfront commission paid by the AMC’s are same whether you invest thru FundsIndia / or direct Agent. The other thing about online share trading portal is you need to pay a/c opening charges, transaction charges and annual account maintenance charges even if you don’t trade in shares.
            So, give a deep thought and take a call !!!!
            Happy Investing.

            Siva – FundsIndia – IFA

          • Puja

            Dear Manish,
            Is Funds India a reliable source? After reading your blog I went to FundsIndia site. However, I have not heard about this company before. Since its free lot of people would have been on this rather than going for demat accounts where they have to pay annual charges and all charges related to online shares purchase and mutual funds.
            How do these guys provide all these free services? There must be some catch here for sure. Also I am little scared to give out my bank details and other related information. How authentic are they? I am asking you this coz you’ve mentioned them here.

            • Puja

              I am no one to certify them . You always here about a company for the first time , FundsIndia is in existent from last 2 yrs , thousands of people have invested through them , they are online brokers and have tie ups with lots of Banks and AMC’s . So make sure you read about them and hear about them a lot to make sure you trust them .

              How do they earn . They are online agents and they also earn the same way an agent earns , which is through trail commission, which AMC’s pay every agent .


  40. T. Yatin

    Could you comment on Quantum: (a) For no charges, as a fund house (b) In an earlier article, you compared best diversified equity funds. I thought you should have considered Quantum Long Term Equity Fund in that study – I know it is relatively new but now almost 4.5 years, but consistent. (c) Since you did an excellent article on comparing equity diversified portfolio, can you consider complementary diversified funds within an individual’s portfolio e.g. if I have HDFC Equity, I may not add HDFC Top200 to the same portfolio, so as to get better diversity. In short which MFs are best matched?

  41. Sneha

    I inquired about Mutual funds: for an SIP of 3000 monthly , the agent demands a commission 3000(one time). Is that justified And moreover it is not even clear if anything will be deducted from the invested money by the fund house too as commission. Do all the fund houses take commission from invested amount?

    • Sneha

      3000 is too much as commission , why do you want to go with the agent at all .. You can invest online through fundsindia or AMC’s portal or even you can go directly to AMC office and make the investments yourself . AMC’s dont deduct commissions per se , but they deduct expenses for themselves which is called expense ratio .



      • Sneha

        So the online payment to fundsindia/AMC portal. how secure is it? And the only reason for considering an agent was time shortage. like instead of going all the way to AMC office. and the online payment will be in a auto debit manner? Will there be any Customer executive from the fund house who will keep you updated with the status of your funds?

        • Deepak R Khemani

          There will be no one from the fund house who will follow up with you personally except that they will send you an account statement on a quarterly basis in case of SIP. I’m sure if you sit down and talk with your agent/advisor he can charge you a reasonable amount. The need for an advisor comes when you are not decided as to which scheme you want to invest with which fund house, and also followup is needed with AMC in case of non receipt of Statement, change in address Change in Bank particulars, mistakes in name spelling and other problems which may come up in the future. Always take advice from a trusted friend/ family advisor/ agent who is known to you of your family who will definitely help you when it is required the most.

    • Debashis

      Yes , as per a SEBI circular in May 2010 , trail commissions will not be paid to any one if the mutual funds units are transferred from one agent to another, the trial money will be deposit in a fund which will be used by AMC’s for other financial literacy and related programs . see : http://www.dnaindia.com/money/report_no-trail-commission-if-distributor-changed-amfi_1380296

      However I read some where that if source agent gives a “Clearance Certificate” (kind of NOC) to the target agent , then trail might be paid to him, I am not very sure on this and also its very unlikely that any one will be happy to give that kind of NOC


      • Deepak R Khemani

        As of now the rule clearly states that no trail will be payable to anyone after change of agency even if NOC is given by the previous agent. That is another matter that no one will give an NOC. What was happening was that when this was being allowed the new agents without informing the customer used to take signatures on a set of forms, one of which was the change of agent application form from the customer without he knowing what form he or she was signing on, and this application was submitted to the registrars who changed the agent because the rule allowed it, The national distributors in that short time took advantage of this and submitted literally thousands of applications to the registrars in a matter of days and finally when the registrars complained to the AMCs, AMFI and SEBI about the volume of applications recieved that this finally came to an end.

  42. Ganesh.A

    hi, i am amfi agent, i would like to take advice from you that is it good to be a working under a distributor or be a IFA.I learned that distributors also take some percentage from their agents is it true, in that case is it not better to work like a IFA and earn the entire percentage.
    plz clarify my query.

  43. krishna

    hi manish

    i want to start an sip of 3000 monthly for 3 years, so i want to know a about a good scheme and aspected return after 3 year also.

  44. Quite a huge number of people considering to get into MF’s just because of the trail commissions & keeping all the profits for themselves.

    I wonder how come people are not considering to have their own departmental stores. In this case the benefits looks even more attractive. You can have credit from your vendors, keep the complete savings (no AMC, No registar) avoid paying taxes (like most of the owners), become your life long customers, use products at lesser than MRP

    • Sharath

      Good point, Most of the times people see the good part and that too an exaggerated one in their mind , they dont know how tough it is to generate good client base and howmuch work it requires .


    • bhupesh

      Departmental store brings multiple items for you to select from display, it stock those items (incur inventory carrying cost). So you pay (margin) for it and bargain on price also.

      Then you had Dell which sold computers directly to consumer, on thin margin; Sam’s Club, Costco etc removes departmental stores in between, like buying from warehouse; Amway, Tupperware (MLM – multi level marketing ) ; web sites directly selling stuff to consumer.

      In another way People still go to whole sell market for better (whole sell) price.

      So it is not new, there is effort from both the side to directly reach to customer or directly buying from companies.

      If it extends to MF, it is no surprise!

      • Bhupesh,

        I’m not certain if you got the point I was trying to refer. I wasn’t refer trying to get to the customer directly. I was referring to people getting into the business directly for the commissions.

        Anyways, what the post exactly meant was people consider the trail commissions but do not pay the slightest attention to something called financial literacy & financial Planning. the main reason why people don’t try to get into business is not because of the logistics & other technical reasons but it’s because of the people. It takes quite a lot from an individual to maintain relationships, fire a few of the troublesome customers, live upto people’s expectations and more. Yet there are some misers, who’ll still expect to get the services for free.

        Tell me something Bhupesh, would you take dental service online? would you buy shoes online? Personally speaking I think investments are somewhat on the same grounds.

        • bhupesh

          Would you buy MF from online or through advisor? What I got from you that you will buy it through IFA. Is not MF and insurance are being sold online also with no advisory?

          Bank and IFA through whom I bought MF schemes in 03,04,… non of them are in touch with me to advice further on my MF investment while they still getting hefty trail commission ( 7-9 x 0.5% original investment).

          What I am saying is that, improvement has to be on all front corporate distributer, IFA and customer. To illustrate that I kept certain perspective through different comments on this site.

          This business still has to evolve, customer has to reach to good IFA and find value in their advise and pay. IFA has to reach and win customer and differentiate with corporates selling. You can not tell corporates how to do business :)

  45. Puja

    Hi Manish,
    The above information is quite good. Thanks for that. Also I wanted to know, what if you invest directly thorugh a bank? Are you charged these commisions then as well?


    Hi Manish,

    I am investing 5000 PM in mutual funds. Before reading your article, I was under impression that 100% of my money is being invested in mutual funds as there is no entry load. But now I came to know that I was wrong.
    Now I have some doubt about the commission from client because my agent never asked me about any commision. So please clarify that how the agent is getting this commission. Whether it is adjusted from the NAV or my agent will ask for it in future??


      • NIRANJAN


        I am little bit confused because as mentioned in the article,
        1) Commission from Client
        After the abolition of entry loads, client has to compensate the agents directly.

        • Niranjan

          Yes , after the abolistion of entry loads , now agents can ask for the commission directly from the customer , but only if client thinks that its worth to pay he can pay , else there is no need .


          • Sharanu


            all info is accurate except this:when the AUM is transferred from one AMFI code to another code neither new AMFI or the OLD will be entitled for the trail commission , it goes to the AMC.This is as per AMFI circular.

            And also few more things to consider:The hype of trail commission is slightly high , but the challenge is holding on to the AUM(Assets Under Mgmnt) , Not many investors hold on to 2 yrs or above , though there r many who invests for 5 yrs , so there is always redemption pressure.plus ur charts haven’t included the 10.3% service tax , AMC deduct service tax before paying the upfrtont or trail commissions.

            to conclude only when u(distributor) advice investors with better funds and they grow at better % u trail commissions also grows , isnt it win-win deal ?


            • Sharanu

              Regarding your comment “all info is accurate except this” . I am not sure what is wrong , As far as I know ,”when the AUM is transferred from one AMFI code to another code neither new AMFI or the OLD will be entitled for the trail commission , it goes to the AMC.” . This is correct . ONly when the old agent issues a NOC, the new agent can get the commission .BUt if he doesnt , this commission goes to a seperate fund which will be used for investors education programs . Let me know what is right if this is incorrect .


              • Sharanu


                As per knowledge and experience the NOC doesn’t matter for for getting the commission on the newer investments , its the OLD investment that goes without trail even in case NOC is issued.Effectively there is no way to get the trail commission on the old investments when the AUM is transferred.in such a case its AMC which is under benefit and neither of the OLD or NEW AMFI agents.

                Corect me if i am wrong.


                • Sharanu

                  My comment was based on Amfi’s Best Practice Guidelines Circular No 15/2010-11, sent to asset management companies on May 7, 2010. which says

                  “On change of distributor (ARN Code) and on transfer of AUM from one distributor (ARN Code) to another distributor (ARN Code), the trail commission in respect of transferred assets should not be paid to old distributor (ARN holder) as well as to new distributor (ARN holder),” states the circular.

                  However, mutual fund houses cannot rejoice about saving this money. “The amount of commission so saved be accounted for separately and utilised for the purpose of education of investor,” asset management companies have been instructed.

                  If anything has happened after that date , then i am not sure ; here is the link : http://www.dnaindia.com/money/report_no-trail-commission-if-distributor-changed-amfi_1380296


  47. Sooraj

    Hello all,
    I have a SBI Magnum and a Sundaram Paribas MF.
    I purchased SBI MF from their MF head office and so I guess I don’t have an agent in that deal.Infact i remember them telling that they wont charge anything as agent commission since i bought it directly.Is it true? If its so what about trail commission?
    But in the case of Sundaram Paribas, I bought it from an ICICI bank and hence they are agents.

  48. shekhar

    Ha Manish, I am planning to invest directly, as i have sufficent knowledge in investing in mutual funds, is there a method by which i introduce my friend or brother and let him pocket the trail commission rather than the AMC

    • Sharanu

      hi shekahr

      for that ur frnd / bthr has to be AMFI certified distributor and if youhave any ongoing SIPs you need to stop all and start them all over again on their ARN code.then only they can get the trail as well as upfront commsion.same holds good for any news SIPs you wanna start.


  49. moon

    nice info guys but why you all worry so much about agent commission??? if you one uses this time and energy to work out financial goals and actions that would be wise…..

    lets assume if X recommends me a fund which gives good return of 15% that is good man why would i wana know his commission ? assuming if a fund has gives me 10% return over 20 years even if they pay high commission to agent why would i bother in fact that agent is entitled to that amount for his services that he has recommended me a good fund ………

    so stop worrying about commissions and what others are earning think how you can multiply your money

    • Sharanu

      HI Sapan

      to get the benefits u have build ur client base , and sell MF related services .
      with entry load abolition the commissions have come down from the mutual fund companies and you are supposed to ask the same from your clients / investors.
      if you start giving quality service backed by better fund selection and post sale service in the long run you wil make money.
      but its very tough to make money in short term unless u get investors who invests in crores :)



    Excellent blog…I have not yet started investing in MF…..this blog realy helps me a lot….Thanks

  51. Zameer MIrza

    Hi Manish,

    Is there any change in Commission Table which you provided. I think this is a year old table.


  52. shrikant shinde

    Its very goooooooooood blog. I got more answers about the MFs ,SIPs.
    Iam not a AMFI distributor,and not a MF sub-broker, but want to become a MF distributor.I have one question i.e. can we use MLM in MF ?

  53. sandeep Dattatreya Pande

    I have good knowledge and experience in Mutual fund Investment. Please guide me how can I utilise it to earn commission ?
    whare can I get details of AMFI exam.
    what is eligibility to beocme a MF advisor ?
    Please guide

  54. Saurabh G

    Now that a Rs100/150 commission has been authorized by SEBI, are there 4 different types of commission:
    3 types that u hav already mentioned + Rs 100/150 as authorized by SEBI recently??

  55. praveen

    Sir I am a mutual fund distributor with Sundaram Mutual fund . For the past 1 year I am not receiving any commission from them .when I asked ,they told me that the brokerage amount payable to me is under 100.so they will not issue it. I checked with other fund houses and they told me that when my brokerage amount is above 100 they will give me. Why is Sundaram like this and where should i complain ?
    expecting your reply

    • Praveen

      You are saying the same thing for both fund houses . Sundaram will not issue because the amount is less than 100 and others are issuing when its more than 100 .. both the things are same things .. What is your commission amount ?


      • praveen

        sir they are not paying for past one year. the reason they are telling is monthly amount is below 100.00. Any way after two months it will become above 100. but they are not paying ,i asked for the brokerage last payed and pending report. They are not willing to give. what must I do ?

  56. Rakesh

    Hi Manish,

    If I understand correctly,
    Expense ratio is inclusive all the charges like Upfront Commission, Trail Commission, etc. except entry and exit load (if there are any).


  57. Jignesh

    My wife is mutual fund agent. If we are investing in MF under her agent code with joint holding in which she is second holder. Does this will qualify for commission?

    • Per the code of conduct for distrubutors the distributor must not be a direct beneficiary of the commission. So if your spouse is a MF agent she cannot be one of the holders of the folio.

      Whether MFs have a way to detect this:
      They have the distributor’s PAN and the customers PAN. It is very easy to create the ecosystem to find this out.

      Do AMCs do this check:
      Possiblby some AMCs do it not all – as I know of someone who has been doing the same thing at least for a few months like what you are proposing.

      The AMC can terminate the distributorship + withhold all accrued payments as well if they detect a violation. If your spouse does this for a living (Being a MF agent) I would definitely advise you not to include her in the folio.

  58. lekhit doshi


    i want to know that how can i got amfi registration no. & i also want to know that if any person passed nism exam also work as a mutual fund advisor .

  59. muhammed sabith

    I am a banker…I hold amfi certificate and ARN code..can i become an agent outside(other than bank’s business)

    Also,is it possible that one persons can become an agent of multiple AMC?

  60. muhammed sabith

    Thanks manish…

    Recently i could see that,most of the Debt funds are giving more than 9% returns annually…is it a study income??

  61. utpal

    In mutual fund I think most important part is “EXPENSE RATIO” can you write a article on it with example?
    I think most of us dont know how much we’ll get after 10 or 15 or 20 yrs.
    I have some articles about expense ratio it is too much scary.

  62. bond

    Hello,i want to know that while buying a MF / buy directly from company or from broker:if from broker eg 10000Rs i should get 1000 unit but i got less units ie his commission is deducted from my amt?
    Also to redeem or exit from MF should i direct to company / cams or else to broker
    where again his commission will deducted from my amt?
    here my broker did not advised me properly to exit at right time & now due low market i m in loss.All my funds are in growth/div reinvest.

    • There is no commission cut from your investment in mutual funds . Selling decision has to be taken by you , no one else . if your broker says SELL and you do , and then market rises more , will you say that he advised wrongly ?

  63. ravi shankar

    I would simply say these are mutual frauds, benefitting only Agents ,Fund Managers & Companies, at the cost of innocent people……….

  64. charan

    Hello sir,

    If i pass nism certification , can i get commission if i invest in mutual funds for my own and to my parents or there is any rules

    thank you

  65. Gaurav

    How many investors pay fees ?? Very few, I guess !!

    We must also understand that the rebate culture is deep-rooted. Investors ask
    for hefty kickbacks and are obliged by the “12 policy a year insurance agent.”

    Consider that in recent times with the increase in petrol prices (and rickshaw fare)
    the travelling cost for an agent has gone up considerably.

    The general thinking that mf agents make big merry is not entirely true. What’s wrong if a mf agent makes money, like any other distributor

    The over scrutiny wrt the distributors commission will kill this industry.

  66. Rohit Varma

    Hi Manish. Hope you are doing good. Had a doubt…

    In the table where you considered an example of 10,000 Sip per month and displayed a table. in the 1st row against AUM column value is 0. What is the reason.

  67. Ravi

    Manish ji, Now that mutual funds have launched the direct plans. pelase give your views on it. Do you advice switching our current units to direct plans and also investing under direct plans. please do a post if possible. i think we will save a lot beacuse of investing in direct plans. please advice.

  68. bipin patel

    sir i have cleared AMFI exam & i want to in field of mutual fund advisory . sir for obtaining ARN CODE. I have to pay 5000/- to AMFI
    Need some clarification on this….

    can u also provide me u r office address or mobile no. i want to contact u personally.

  69. Anuj

    sir,,,,,,,you provide me the list of different entry and exit charges provide by AMC’s to different mutual funds company like karvy,kalptaru etc….

  70. Hrudananda

    Hi Manish,
    I have a quarry on Transaction charges levied by AMC.
    I have invested Rs.15000 into reliance tax saver fund. (In existing folio number)
    As I am new investor to the particular fund (already an investor of Reliance AMC) they have deducted Rs. 100 as Transaction charge.
    After 3 days I have purchase additional units of Rs.15000 and Rs.6000.
    From this they have deducted again Rs. 100 as TC.
    Now the total investment showing Gross investment = Rs36000, Transaction charges = Rs. 200 and Net investment = Rs 35800
    By contacting, the AMC is telling that as per rule, as the investment is more than Rs.10000 they have deducted TC.
    Please let me know,
    Is AMC is can deduct TC each and every time the investment is more than Rs. 10000?
    If not, please let me know where I can complain against it.

      • Hrudananda

        Hi Manish,

        I have purchased it through HDFC bank online and HDFC is opted in for TC.
        So in that case,agent will get Rs.100 even for additional purchase of more then Rs.10000?
        What if I do SIP of Rs.2000*6, still they will get Rs.100 as TC.
        As per my knowledge other AMC’s are not charging TC for additional purchase or for SIP more then Rs.10000.

        Please help me to understand the rule.

        • Rahul Kumar

          Hope I can explain you here.
          HDFC ‘Bank’ is a bank and HDFC ‘Asset Management Company limited’ is so called HDFC ‘Mutual Fund’.
          HDFC Bank and its other subsidieries work as a ‘Mutual Fund agent’ for ‘HDFC Mutual Fund.
          Since you mentioned that you have purchased through HDFC Bank online so in effect you purchased through an agent and thus commission is liable.
          This you can easily understand by seeing your mutual fund statements where you can see the agent code ‘ARN Number’ not ‘DIRECT’. In case you see it as ‘DIRECT’ then surely you should not be charged any TC and you can complain to SEBI/AMFI.
          Please check and let me know.

  71. Ashish

    Dear Sir,

    I have a query relating to Service tax

    If I’m a stock broker company & investor invest in mutual fund through us so i want to ask that, service tax which mutual fund company pays to the government, who will get that credit benefit of it either the broker or mutual fund company.

    Sir please revert in detail me asap.

    Thanks & Regards

  72. CK

    Birla Sun Life Mutual Funds have the worst customer service imaginable. I’ve been trying for a week now to link their URN to my bank account but it doesn’t work. They’ve even asked me to try via different browsers and re-register my SIPs. Nothing. Then they ask me to write to their Customer Service via email. AND THEY DON’T REPLY! Genius. Well, if they don’t want my money, I’ll just take it elsewhere.

  73. Raghav

    Hi Manish,

    I want to know once i clear NISM-seies-v A exam which is for Mutual fund distributorship, i have to bought NSE license in order to sell mutual funds?
    if yes, what is the approx cost to get the license?

  74. Gaurav

    Is it not right for the distributor to earn if he is going to do the donkey’s work and provide the client service? The inflation in travelling cost / petrol prices are applicable to financial advisors as well.

    It’s time financial advisors started charging servicing fees to clients

  75. Shekhar S

    Thanks for posting a good article. All the investors should know one thing, the role of a good financial adviser is to understand the client’s requirement, help him in finalizing goals and drawing out a investment plan to reach the goals. If there weren’t any brokerage attached to that, none of them will be interested to spend their time. A financial adviser’s success is very much based on his client’s success in achieving goals on time. The brokerage is very much justified. If there were no financial advisers it would be very difficult for the investors to understand the pros and cons of thousands of funds available in the industry. Would the investors work for a company for free. There is no free lunch. There is no mention of the mis-selling happening in this industry by the LIFE INSURANCE COMPANIES marketing their ULIPS and endowment policies. Had the investor at any time analysed what returns they get from these policies and the first year allocation charged. The financial advisory market in India is not a matured one and there are very less percentage of investors ready to pay fee for the advise. Most of them want it for free. And this is the reason insurance policies are mis-sold, and the regulator still waits for someone to complain it with evidence.
    Investors please be aware of the financial product you are being sold and discuss the pros and cons before signing the document. Paying a advisory fee would help you in minimizing mis-selling.

  76. AMAR

    My wife is going to give her AMFI exam very soon. After she clears her exam, What is the process to be followed for starting bussiness. Can some one help me here or share me some links or contact points; so that I will proceed accordingly. I have gone through all 300 posts above and it has given some clues. I would to like to be more clear on this. Thanks in Advance again

      • AMAR

        Manish, Thanks for your response. What I was looking here is – After she clears AMFI exam how can she start doing bussiness. Where she has to register her name to start doing bussiness. I have seen some posts above like she has to enroll with Karvy or some where. I would like to know some more POC like Karvy and others.

  77. manjunatha

    I invested in different MF since last three years, now I want to close all of them because of badly need of money. Is any problem to agent or whether he is penalised for withdrawing with in five years.

    • All you need to do is apply for ARN code . You can download the form from amfi website, and attach a 3k demand draft along with KYD copy . Then empanel with Fund houses and then you can start selling their funds


      • Santosh Jha

        Thanxx Manish, I have gone through AMFI site, there is a category of new cadre of distributor Intermediaries / Agents engaged in distribution of financial products e.g. insurance agent, FD agent, National Savings Scheme products can register and its fees is 1500.I also have a FA code in PNB metlife Insurance India Ltd. Can i register for this category.?

  78. prashant patel

    dear sir,
    any detail circular regarding trail commission on mutual fund was started and paid to distributor with effect from, please provide me.
    prashant patel

  79. atanu

    Hi Manish,
    Great article. But after read this, I am little confused on selecting desired Large cap fund(at below). My time frame is 20-25 years.
    I have desired to invest through SIP Rs 1000/month in one large cap. I have considered following Large Cap. (But I have to choose only one). –
    1>Fund Name: Quantum Long Term Equity Fund.
    Expense ratio: 1.25%
    2>Fund Name: ICICI Prudential Dynamic Plan.
    Expense ratio: 2.25%

    Note: I’ve already following MF in my portfolio-
    A>HDFC Top 200 Fund (1000/month sip)
    B>ICICI Prudential Focused Bluechip Equity Fund (1000/month sip)
    C>Reliance Gold Savings Fund(500/month sip).

    Please choose for me. Or advise me for best MF on long term.
    Thanks again for good articles and many thanks in advance for your advice.

  80. Karan Sinha


    I would like to know, the commission is all three for sub broker as per the example given above
    SIP per month : Rs 10,000
    Commission paid to Agent by Customer : 1% (for every payment)
    Upfront Commission paid to Agent by AMC : 0.5% (for First year)
    Trail Commission paid to Agent by AMC : 0.5% (for subsequent years)

    or any of the above. Kindly suggest me

    Karan Sinha

  81. Srini

    Once I get my ARN # should I approach indivvidual AMC seprately and enroll with each and every AMC to sell their products? or the investors can use my ARN # in any AMC so that I get my Commission…………

    Please explain how it works.

  82. Prashanth

    We can act as an sub-distributor to individual firms which has tie up with all mutual funds.. This way would be easy instead of getting enrolled with each MF. Manish your thoughts on this???

  83. Sumit

    Sir how must the agent collect Commission from client? Is it by way of cheque? or any other mode? What is the procedure exactly? Thanks in advance.

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