POSTED BY March 22, 2015 11:38 pm COMMENTS (4)
ONHi Manish,
Thanks for your blog and excellent forum.
I am asking this question on behalf of my dad. He has been investing in various mutual funds through an agent who works for BlueChip (http://www.bluechipindia.co.in). My dad says he doesn’t pay any commission to this agent, there is no entry load and also the full amount is invested. I am not sure how the agent gets paid then. Do the mutual fund companies pay these agents? Can you throw some light on this?
Thanks,
Arun.
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Yes the Mutual Fund AMCs are tied up with all of the brokers and they get a certain percentage of these amounts.
What about online agents like fundsindia & scirptbox? Do they get charge some annual charge for processing?
Your father is very innocent.MF AMC will pay commission to agent out of your father portfolio earnings.(though this will not be seen anywhere in portfolio)Suppose MF makes a profit of 13 % then about .5% will be passed on to your agent as trailing commission.In addition to this about 1.5 to 2.0 %will be charged as MF scheme expenses.This is an annual process.
Yes, Mutual funds companies will pay commission to these agents .