Direct Vs Regular Mutual Fund Investment Plans

Updated on September 28, 2026 , 4397 views

While most of the investors invest in Mutual Funds through regular plans, but the rising popularity of direct plans amongst the new investors has led to an increase in demand. Regular plans have been available to the investors for a much longer time than direct Investment plan. The first direct mutual fund plan got introduced in January 1, 2013.

So, for a fair understanding between regular vs direct Mutual Funds, here’s a comparative article that would guide you in choosing the right plan, as per your investment needs.

Regular Vs Direct : Know the Difference

The regular plans and direct plans are not two different schemes, but in fact, they are variants of the same principal scheme offered by AMCs. Both the plans- direct and regular, prominently differs in some parameters that are:

a. Distribution

An investor can buy a mutual fund with a regular plan through various routes like brokers, RTAs such as CAMS, Karvy, third-party securities market intermediaries, directly through the AMC as well as through various representative offices of the fund house. While, direct plans can be bought through limited platforms - a very few third-party securities intermediaries, RTAs such as CAMS/Karvy, and authorized local representatives of the fund house. But, since many prefer to consider buying Mutual Fund Online, both direct and regular plans are available via the online mode as well as the physical/paper-based mode.

b. Expense Ratio

One of the main reasons why direct plans look attractive is due to its lower expense ratio. Mutual funds with regular plans have higher expense ratios compared to direct plans. The lower expense ratio results from the fact that direct plans don’t incur any agent commissions or distributor fees that are payable to brokers or distribution agents of the regular mutual fund schemes. Due to which, the potential returns offered by the direct mutual fund schemes are higher than that of mutual funds with regular plans. The lower expense ratio of direct plans is gaining attraction of the investors, especially amongst new investors.

c. NAV

In mutual fund investment, the value of the investment is expressed as the fund’s Asset Under Management (AUM). As direct mutual plans have a lower expense ratio, the saving in commissions is added to the return of the scheme in for of a higher NAV (Net Asset Value) each day.

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Therefore, the NAV of a direct plan is relatively higher as compared to regular plans.

Parameters	Regular Plans	Direct Plans
Convenience	More	Less
NAV	Lower	Higher
Expense ratio	Higher (commission to the intermediary)	Lower
Returns	Less as the AMC fee is more	More as the expense ratio is lesser

Fund Selection Methodology used to find 10 funds

Category: Equity
AUM Range: 500 to 100000 Cr
Minimum fund age: 3 years
Sorted On : 3-year return (high to low)
No Of Funds: 10

Best Direct Mutual Fund Plans

Investors who want to invest in mutual funds with direct plans, here are some of the best performing direct mutual funds as per highest AUM.

Fund	NAV	Net Assets (Cr)	3 MO (%)	6 MO (%)	1 YR (%)	3 YR (%)	5 YR (%)	2025 (%)
Franklin India Feeder - Franklin U S Opportunities Fund - Direct Growth	₹107.326 ↑ 0.18	₹5,955	3.1	25.2	16.7	25	11.5	12.4
Franklin Asian Equity Fund - Direct Growth	₹49.1551 ↓ -0.11	₹996	-1.6	26.9	33.7	23.9	9.3	24.7
Franklin India Opportunities Fund - Direct Growth	₹291.378 ↑ 0.32	₹9,717	1.4	14.6	4	20	17.8	4.4
IDBI Small Cap Fund - Direct Growth	₹39.7478 ↑ 0.04	₹832	4.5	35.7	17.9	18.1	17.5	-12.1
DSP Micro Cap Fund - Direct Growth	₹254.397 ↓ -0.47	₹21,659	5.3	31.5	20.3	17.6	17.7	-1.9
Sundaram SMILE Fund - Direct Growth	₹327.423 ↑ 0.49	₹4,155	2.3	29.6	15.9	16.1	16.2	1.5
Franklin Build India Fund - Direct Growth	₹158.733 ↑ 0.12	₹3,152	-7.4	3.4	-1.7	14.7	17.5	4.8
Franklin India Prima Fund - Direct Growth	₹3,035.06 ↑ 5.92	₹13,052	-2.4	12.2	0.8	14.2	12.5	2.4
Edelweiss Economic Resurgence Fund - Direct Growth	₹43.533 ↑ 0.01	₹3,722	-3.1	7.4	-0.1	13.3	11.9	7
Franklin India Smaller Companies Fund - Direct Growth	₹198.676 ↑ 0.87	₹14,746	-0.7	20.5	6.4	12.1	15.3	-7.6
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Sep 26

Research Highlights & Commentary of 10 Funds showcased

Commentary	Franklin India Feeder - Franklin U S Opportunities Fund - Direct	Franklin Asian Equity Fund - Direct	Franklin India Opportunities Fund - Direct	IDBI Small Cap Fund - Direct	DSP Micro Cap Fund - Direct	Sundaram SMILE Fund - Direct	Franklin Build India Fund - Direct	Franklin India Prima Fund - Direct	Edelweiss Economic Resurgence Fund - Direct	Franklin India Smaller Companies Fund - Direct
Point 1	Upper mid AUM (₹5,955 Cr).	Bottom quartile AUM (₹996 Cr).	Upper mid AUM (₹9,717 Cr).	Bottom quartile AUM (₹832 Cr).	Highest AUM (₹21,659 Cr).	Lower mid AUM (₹4,155 Cr).	Bottom quartile AUM (₹3,152 Cr).	Upper mid AUM (₹13,052 Cr).	Lower mid AUM (₹3,722 Cr).	Top quartile AUM (₹14,746 Cr).
Point 2	Oldest track record among peers (13 yrs).	Established history (13+ yrs).	Established history (13+ yrs).	Established history (9+ yrs).	Established history (13+ yrs).	Established history (13+ yrs).	Established history (13+ yrs).	Established history (13+ yrs).	Established history (11+ yrs).	Established history (13+ yrs).
Point 3	Not Rated.	Not Rated.	Not Rated.	Not Rated.	Not Rated.	Not Rated.	Not Rated.	Not Rated.	Not Rated.	Not Rated.
Point 4	Risk profile: High.	Risk profile: High.	Risk profile: Moderately High.	Risk profile: Moderately High.	Risk profile: Moderately High.	Risk profile: Moderately High.	Risk profile: High.	Risk profile: Moderately High.	Risk profile: High.	Risk profile: Moderately High.
Point 5	5Y return: 11.46% (bottom quartile).	5Y return: 9.25% (bottom quartile).	5Y return: 17.82% (top quartile).	5Y return: 17.54% (upper mid).	5Y return: 17.74% (top quartile).	5Y return: 16.18% (upper mid).	5Y return: 17.50% (upper mid).	5Y return: 12.54% (lower mid).	5Y return: 11.87% (bottom quartile).	5Y return: 15.32% (lower mid).
Point 6	3Y return: 24.97% (top quartile).	3Y return: 23.87% (top quartile).	3Y return: 20.00% (upper mid).	3Y return: 18.12% (upper mid).	3Y return: 17.60% (upper mid).	3Y return: 16.13% (lower mid).	3Y return: 14.70% (lower mid).	3Y return: 14.16% (bottom quartile).	3Y return: 13.25% (bottom quartile).	3Y return: 12.11% (bottom quartile).
Point 7	1Y return: 16.73% (upper mid).	1Y return: 33.70% (top quartile).	1Y return: 4.00% (lower mid).	1Y return: 17.92% (upper mid).	1Y return: 20.27% (top quartile).	1Y return: 15.94% (upper mid).	1Y return: -1.72% (bottom quartile).	1Y return: 0.85% (bottom quartile).	1Y return: -0.10% (bottom quartile).	1Y return: 6.35% (lower mid).
Point 8	Alpha: -2.33 (bottom quartile).	Alpha: 0.00 (lower mid).	Alpha: 2.32 (upper mid).	Alpha: 9.65 (top quartile).	Alpha: 10.81 (top quartile).	Alpha: 7.97 (upper mid).	Alpha: 0.00 (lower mid).	Alpha: -5.38 (bottom quartile).	Alpha: 2.77 (upper mid).	Alpha: -2.10 (bottom quartile).
Point 9	Sharpe: 0.63 (upper mid).	Sharpe: 1.43 (top quartile).	Sharpe: 0.20 (bottom quartile).	Sharpe: 0.76 (top quartile).	Sharpe: 0.75 (upper mid).	Sharpe: 0.70 (upper mid).	Sharpe: 0.02 (bottom quartile).	Sharpe: 0.19 (bottom quartile).	Sharpe: 0.24 (lower mid).	Sharpe: 0.26 (lower mid).
Point 10	Information ratio: -1.11 (bottom quartile).	Information ratio: 0.00 (lower mid).	Information ratio: 1.39 (top quartile).	Information ratio: 0.50 (upper mid).	Information ratio: 0.62 (upper mid).	Information ratio: 0.33 (upper mid).	Information ratio: 0.00 (lower mid).	Information ratio: -0.11 (bottom quartile).	Information ratio: 1.32 (top quartile).	Information ratio: -0.43 (bottom quartile).

Franklin India Feeder - Franklin U S Opportunities Fund - Direct

Upper mid AUM (₹5,955 Cr).
Oldest track record among peers (13 yrs).
Not Rated.
Risk profile: High.
5Y return: 11.46% (bottom quartile).
3Y return: 24.97% (top quartile).
1Y return: 16.73% (upper mid).
Alpha: -2.33 (bottom quartile).
Sharpe: 0.63 (upper mid).
Information ratio: -1.11 (bottom quartile).

Franklin Asian Equity Fund - Direct

Bottom quartile AUM (₹996 Cr).
Established history (13+ yrs).
Not Rated.
Risk profile: High.
5Y return: 9.25% (bottom quartile).
3Y return: 23.87% (top quartile).
1Y return: 33.70% (top quartile).
Alpha: 0.00 (lower mid).
Sharpe: 1.43 (top quartile).
Information ratio: 0.00 (lower mid).

Franklin India Opportunities Fund - Direct

Upper mid AUM (₹9,717 Cr).
Established history (13+ yrs).
Not Rated.
Risk profile: Moderately High.
5Y return: 17.82% (top quartile).
3Y return: 20.00% (upper mid).
1Y return: 4.00% (lower mid).
Alpha: 2.32 (upper mid).
Sharpe: 0.20 (bottom quartile).
Information ratio: 1.39 (top quartile).

IDBI Small Cap Fund - Direct

Bottom quartile AUM (₹832 Cr).
Established history (9+ yrs).
Not Rated.
Risk profile: Moderately High.
5Y return: 17.54% (upper mid).
3Y return: 18.12% (upper mid).
1Y return: 17.92% (upper mid).
Alpha: 9.65 (top quartile).
Sharpe: 0.76 (top quartile).
Information ratio: 0.50 (upper mid).

DSP Micro Cap Fund - Direct

Highest AUM (₹21,659 Cr).
Established history (13+ yrs).
Not Rated.
Risk profile: Moderately High.
5Y return: 17.74% (top quartile).
3Y return: 17.60% (upper mid).
1Y return: 20.27% (top quartile).
Alpha: 10.81 (top quartile).
Sharpe: 0.75 (upper mid).
Information ratio: 0.62 (upper mid).

Sundaram SMILE Fund - Direct

Lower mid AUM (₹4,155 Cr).
Established history (13+ yrs).
Not Rated.
Risk profile: Moderately High.
5Y return: 16.18% (upper mid).
3Y return: 16.13% (lower mid).
1Y return: 15.94% (upper mid).
Alpha: 7.97 (upper mid).
Sharpe: 0.70 (upper mid).
Information ratio: 0.33 (upper mid).

Franklin Build India Fund - Direct

Bottom quartile AUM (₹3,152 Cr).
Established history (13+ yrs).
Not Rated.
Risk profile: High.
5Y return: 17.50% (upper mid).
3Y return: 14.70% (lower mid).
1Y return: -1.72% (bottom quartile).
Alpha: 0.00 (lower mid).
Sharpe: 0.02 (bottom quartile).
Information ratio: 0.00 (lower mid).

Franklin India Prima Fund - Direct

Upper mid AUM (₹13,052 Cr).
Established history (13+ yrs).
Not Rated.
Risk profile: Moderately High.
5Y return: 12.54% (lower mid).
3Y return: 14.16% (bottom quartile).
1Y return: 0.85% (bottom quartile).
Alpha: -5.38 (bottom quartile).
Sharpe: 0.19 (bottom quartile).
Information ratio: -0.11 (bottom quartile).

Edelweiss Economic Resurgence Fund - Direct

Lower mid AUM (₹3,722 Cr).
Established history (11+ yrs).
Not Rated.
Risk profile: High.
5Y return: 11.87% (bottom quartile).
3Y return: 13.25% (bottom quartile).
1Y return: -0.10% (bottom quartile).
Alpha: 2.77 (upper mid).
Sharpe: 0.24 (lower mid).
Information ratio: 1.32 (top quartile).

Franklin India Smaller Companies Fund - Direct

Top quartile AUM (₹14,746 Cr).
Established history (13+ yrs).
Not Rated.
Risk profile: Moderately High.
5Y return: 15.32% (lower mid).
3Y return: 12.11% (bottom quartile).
1Y return: 6.35% (lower mid).
Alpha: -2.10 (bottom quartile).
Sharpe: 0.26 (lower mid).
Information ratio: -0.43 (bottom quartile).

Best Regular Mutual Fund Plans

Investors who want to invest in mutual funds with regular plans, here are some of the best performing regular plans to invest in.

Fund	NAV	Net Assets (Cr)	3 MO (%)	6 MO (%)	1 YR (%)	3 YR (%)	5 YR (%)	2025 (%)
DSP World Gold Fund Growth	₹58.7417 ↓ -0.07	₹1,828	18.7	6.9	32.2	56.6	30.1	167.1
DSP US Flexible Equity Fund Growth	₹92.9282 ↓ -0.28	₹1,270	1	21.6	29.7	27.6	18.4	33.8
Kotak Global Emerging Market Fund Growth	₹39.937 ↓ -0.09	₹1,730	-0.3	21.1	35.9	26.8	12.4	39.1
Franklin India Feeder - Franklin U S Opportunities Fund Growth	₹93.9317 ↑ 0.15	₹5,955	2.8	24.6	15.7	23.8	10.4	11.4
Franklin Asian Equity Fund Growth	₹44.4824 ↓ -0.10	₹996	-1.9	26.3	32.5	22.8	8.3	23.7
IDBI India Top 100 Equity Fund Growth	₹44.16 ↑ 0.05	₹655	9.2	12.5	15.4	21.9	12.6
SBI Healthcare Opportunities Fund Growth	₹505.906 ↓ -10.30	₹5,796	2.6	21.7	20.4	21.7	16.7	-3.5
UTI Healthcare Fund Growth	₹333.05 ↓ -7.48	₹1,444	2.1	22.8	17.1	21.5	14.3	-3.1
LIC MF Infrastructure Fund Growth	₹53.6862 ↓ -0.05	₹1,174	-2.5	18.8	9.4	21.4	20.2	-3.7
Invesco India Mid Cap Fund Growth	₹189.82 ↓ -1.04	₹14,721	-2.7	21.3	7.1	20.8	17.2	6.3
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Sep 26

Research Highlights & Commentary of 10 Funds showcased

Commentary	DSP World Gold Fund	DSP US Flexible Equity Fund	Kotak Global Emerging Market Fund	Franklin India Feeder - Franklin U S Opportunities Fund	Franklin Asian Equity Fund	IDBI India Top 100 Equity Fund	SBI Healthcare Opportunities Fund	UTI Healthcare Fund	LIC MF Infrastructure Fund	Invesco India Mid Cap Fund
Point 1	Upper mid AUM (₹1,828 Cr).	Lower mid AUM (₹1,270 Cr).	Upper mid AUM (₹1,730 Cr).	Top quartile AUM (₹5,955 Cr).	Bottom quartile AUM (₹996 Cr).	Bottom quartile AUM (₹655 Cr).	Upper mid AUM (₹5,796 Cr).	Lower mid AUM (₹1,444 Cr).	Bottom quartile AUM (₹1,174 Cr).	Highest AUM (₹14,721 Cr).
Point 2	Established history (19+ yrs).	Established history (14+ yrs).	Established history (19+ yrs).	Established history (14+ yrs).	Established history (18+ yrs).	Established history (14+ yrs).	Established history (21+ yrs).	Oldest track record among peers (27 yrs).	Established history (18+ yrs).	Established history (19+ yrs).
Point 3	Rating: 3★ (upper mid).	Top rated.	Rating: 3★ (upper mid).	Rating: 4★ (upper mid).	Rating: 5★ (top quartile).	Rating: 3★ (lower mid).	Rating: 2★ (lower mid).	Rating: 1★ (bottom quartile).	Not Rated.	Rating: 2★ (bottom quartile).
Point 4	Risk profile: High.	Risk profile: High.	Risk profile: High.	Risk profile: High.	Risk profile: High.	Risk profile: Moderately High.	Risk profile: High.	Risk profile: High.	Risk profile: High.	Risk profile: Moderately High.
Point 5	5Y return: 30.10% (top quartile).	5Y return: 18.38% (upper mid).	5Y return: 12.45% (bottom quartile).	5Y return: 10.39% (bottom quartile).	5Y return: 8.29% (bottom quartile).	5Y return: 12.61% (lower mid).	5Y return: 16.73% (upper mid).	5Y return: 14.33% (lower mid).	5Y return: 20.16% (top quartile).	5Y return: 17.16% (upper mid).
Point 6	3Y return: 56.58% (top quartile).	3Y return: 27.58% (top quartile).	3Y return: 26.85% (upper mid).	3Y return: 23.81% (upper mid).	3Y return: 22.79% (upper mid).	3Y return: 21.88% (lower mid).	3Y return: 21.69% (lower mid).	3Y return: 21.49% (bottom quartile).	3Y return: 21.36% (bottom quartile).	3Y return: 20.76% (bottom quartile).
Point 7	1Y return: 32.18% (upper mid).	1Y return: 29.74% (upper mid).	1Y return: 35.92% (top quartile).	1Y return: 15.66% (lower mid).	1Y return: 32.52% (top quartile).	1Y return: 15.39% (bottom quartile).	1Y return: 20.41% (upper mid).	1Y return: 17.14% (lower mid).	1Y return: 9.44% (bottom quartile).	1Y return: 7.15% (bottom quartile).
Point 8	Alpha: 4.18 (upper mid).	Alpha: -7.01 (bottom quartile).	Alpha: -6.20 (bottom quartile).	Alpha: -3.26 (bottom quartile).	Alpha: 0.00 (lower mid).	Alpha: 2.11 (upper mid).	Alpha: 4.67 (top quartile).	Alpha: 1.26 (upper mid).	Alpha: 10.92 (top quartile).	Alpha: 0.00 (lower mid).
Point 9	Sharpe: 1.25 (upper mid).	Sharpe: 1.42 (top quartile).	Sharpe: 1.39 (upper mid).	Sharpe: 0.58 (bottom quartile).	Sharpe: 1.39 (top quartile).	Sharpe: 1.09 (lower mid).	Sharpe: 1.17 (upper mid).	Sharpe: 0.94 (lower mid).	Sharpe: 0.53 (bottom quartile).	Sharpe: 0.29 (bottom quartile).
Point 10	Information ratio: -1.01 (bottom quartile).	Information ratio: -0.07 (lower mid).	Information ratio: -0.83 (bottom quartile).	Information ratio: -1.35 (bottom quartile).	Information ratio: 0.00 (upper mid).	Information ratio: 0.14 (upper mid).	Information ratio: 0.08 (upper mid).	Information ratio: 0.18 (top quartile).	Information ratio: 0.47 (top quartile).	Information ratio: 0.00 (lower mid).

DSP World Gold Fund

Upper mid AUM (₹1,828 Cr).
Established history (19+ yrs).
Rating: 3★ (upper mid).
Risk profile: High.
5Y return: 30.10% (top quartile).
3Y return: 56.58% (top quartile).
1Y return: 32.18% (upper mid).
Alpha: 4.18 (upper mid).
Sharpe: 1.25 (upper mid).
Information ratio: -1.01 (bottom quartile).

DSP US Flexible Equity Fund

Lower mid AUM (₹1,270 Cr).
Established history (14+ yrs).
Top rated.
Risk profile: High.
5Y return: 18.38% (upper mid).
3Y return: 27.58% (top quartile).
1Y return: 29.74% (upper mid).
Alpha: -7.01 (bottom quartile).
Sharpe: 1.42 (top quartile).
Information ratio: -0.07 (lower mid).

Kotak Global Emerging Market Fund

Upper mid AUM (₹1,730 Cr).
Established history (19+ yrs).
Rating: 3★ (upper mid).
Risk profile: High.
5Y return: 12.45% (bottom quartile).
3Y return: 26.85% (upper mid).
1Y return: 35.92% (top quartile).
Alpha: -6.20 (bottom quartile).
Sharpe: 1.39 (upper mid).
Information ratio: -0.83 (bottom quartile).

Franklin India Feeder - Franklin U S Opportunities Fund

Top quartile AUM (₹5,955 Cr).
Established history (14+ yrs).
Rating: 4★ (upper mid).
Risk profile: High.
5Y return: 10.39% (bottom quartile).
3Y return: 23.81% (upper mid).
1Y return: 15.66% (lower mid).
Alpha: -3.26 (bottom quartile).
Sharpe: 0.58 (bottom quartile).
Information ratio: -1.35 (bottom quartile).

Franklin Asian Equity Fund

Bottom quartile AUM (₹996 Cr).
Established history (18+ yrs).
Rating: 5★ (top quartile).
Risk profile: High.
5Y return: 8.29% (bottom quartile).
3Y return: 22.79% (upper mid).
1Y return: 32.52% (top quartile).
Alpha: 0.00 (lower mid).
Sharpe: 1.39 (top quartile).
Information ratio: 0.00 (upper mid).

IDBI India Top 100 Equity Fund

Bottom quartile AUM (₹655 Cr).
Established history (14+ yrs).
Rating: 3★ (lower mid).
Risk profile: Moderately High.
5Y return: 12.61% (lower mid).
3Y return: 21.88% (lower mid).
1Y return: 15.39% (bottom quartile).
Alpha: 2.11 (upper mid).
Sharpe: 1.09 (lower mid).
Information ratio: 0.14 (upper mid).

SBI Healthcare Opportunities Fund

Upper mid AUM (₹5,796 Cr).
Established history (21+ yrs).
Rating: 2★ (lower mid).
Risk profile: High.
5Y return: 16.73% (upper mid).
3Y return: 21.69% (lower mid).
1Y return: 20.41% (upper mid).
Alpha: 4.67 (top quartile).
Sharpe: 1.17 (upper mid).
Information ratio: 0.08 (upper mid).

UTI Healthcare Fund

Lower mid AUM (₹1,444 Cr).
Oldest track record among peers (27 yrs).
Rating: 1★ (bottom quartile).
Risk profile: High.
5Y return: 14.33% (lower mid).
3Y return: 21.49% (bottom quartile).
1Y return: 17.14% (lower mid).
Alpha: 1.26 (upper mid).
Sharpe: 0.94 (lower mid).
Information ratio: 0.18 (top quartile).

LIC MF Infrastructure Fund

Bottom quartile AUM (₹1,174 Cr).
Established history (18+ yrs).
Not Rated.
Risk profile: High.
5Y return: 20.16% (top quartile).
3Y return: 21.36% (bottom quartile).
1Y return: 9.44% (bottom quartile).
Alpha: 10.92 (top quartile).
Sharpe: 0.53 (bottom quartile).
Information ratio: 0.47 (top quartile).

Invesco India Mid Cap Fund

Highest AUM (₹14,721 Cr).
Established history (19+ yrs).
Rating: 2★ (bottom quartile).
Risk profile: Moderately High.
5Y return: 17.16% (upper mid).
3Y return: 20.76% (bottom quartile).
1Y return: 7.15% (bottom quartile).
Alpha: 0.00 (lower mid).
Sharpe: 0.29 (bottom quartile).
Information ratio: 0.00 (lower mid).

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