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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.
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:
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.
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.
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 |
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 (%) 2024 (%) Franklin India Opportunities Fund - Direct Growth ₹276.232
↑ 1.58 ₹6,485 14.6 -1.7 10.4 35.6 33.1 39.2 Franklin Build India Fund - Direct Growth ₹163.491
↑ 1.62 ₹2,726 16.6 -1.7 5.4 33.8 35.1 29.1 L&T Infrastructure Fund - Direct Growth ₹53.6457
↑ 0.53 ₹2,250 16.8 -5.8 0.9 30.1 33.1 29.4 Franklin India Smaller Companies Fund - Direct Growth ₹197.795
↑ 1.25 ₹12,530 18.1 -5 3.8 29.9 36.5 24.2 Franklin India Prima Fund - Direct Growth ₹3,114.32
↑ 21.05 ₹11,762 16.1 -1.3 13 29.4 29.3 32.9 L&T Business Cycles Fund - Direct Growth ₹48.386
↑ 0.66 ₹998 21.9 -2 13.6 28.6 30.4 37.8 Sundaram SMILE Fund - Direct Growth ₹288.019
↑ 3.09 ₹3,058 19.1 -2.2 10.9 26.7 34.9 20.4 DSP BlackRock Micro Cap Fund - Direct Growth ₹218.374
↑ 2.03 ₹14,258 19.5 -2.7 16.5 25.5 34.9 26.7 Templeton India Growth Fund - Direct Growth ₹798.355
↑ 7.08 ₹2,195 11.2 -0.2 4.1 24.2 31.4 16.6 IDBI Small Cap Fund - Direct Growth ₹33.8791
↑ 0.40 ₹518 12.6 -11.7 6 23.9 34.1 41.5 Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 9 Jun 25
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 (%) 2024 (%) Invesco India PSU Equity Fund Growth ₹65.29
↑ 0.60 ₹1,281 22.6 0.6 2.4 36.2 30 25.6 SBI PSU Fund Growth ₹32.5671
↑ 0.39 ₹5,035 16.6 -0.8 2.4 35.5 31.4 23.5 Franklin India Opportunities Fund Growth ₹250.739
↑ 1.41 ₹6,485 14.2 -2.3 9.1 34.2 31.9 37.3 Nippon India Power and Infra Fund Growth ₹349.903
↑ 3.11 ₹7,026 16.5 -4.6 0.6 34.2 34.6 26.9 HDFC Infrastructure Fund Growth ₹48.198
↑ 0.44 ₹2,392 17.2 -0.9 5.6 34.1 36.1 23 Motilal Oswal Midcap 30 Fund Growth ₹101.433
↑ 0.40 ₹27,780 12.9 -10.4 14.6 34.1 37.2 57.1 ICICI Prudential Infrastructure Fund Growth ₹198.35
↑ 1.88 ₹7,416 16.3 1.3 8.8 33.2 38.3 27.4 IDFC Infrastructure Fund Growth ₹51.059
↑ 0.55 ₹1,577 17.3 -5.8 0.8 33 35.3 39.3 LIC MF Infrastructure Fund Growth ₹50.505
↑ 0.68 ₹887 20.1 -4.2 11.2 32.4 34.3 47.8 Franklin Build India Fund Growth ₹142.333
↑ 1.40 ₹2,726 16.3 -2.2 4.3 32.4 33.8 27.8 Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 9 Jun 25
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