The Mutual Fund industry has added more than 8,000 new distributors this calendar year (2017). Many of these new distributors plus some from the existing community may approach you to solicit mutual fund investments. It would make sense to choose an appropriate financial advisor who can help manage your investments.
Check how well qualified the distributor is in terms of education and what kind of knowledge and experience he or she possesses. The mutual fund advisor should have good knowledge of different asset classes such as equity, fixed income and gold.
He and his team should be in a position to decipher and understand how these asset classes would be affected by various domestic and international events. The advisor should be able to identify products that will meet your life stage requirements as and when they are needed.
It is important for a distributor who you entrust your money with to be accessible. The advisor or his team should be able to answer your queries within a reasonable period of time and should be accessible by whatever means of communication you choose which could be telephonic, email and meetings. Time is of essence in the financial world and he should be able to execute your investments quickly.
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The AMFI Registration Number (arn) has been introduced as the unique code, which identifies the intermediary as ARMFA. In order to promote best practices and ethical standards in the business of sale of Mutual Fund schemes, AMFI has formulated broad guidelines and norms including a code of conduct for the intermediaries, which will be applicable to ARMFA.
AMFI believes that a sincere endeavor to adhere to the guidelines and the code would help promote best and healthy practices in the area of sales and marketing which would ultimately benefit all concerned - the investor, the intermediary and the industry as a whole.
Most investors do not want to discuss their finances and investments with too many people again and again since these are confidential things. They want an advisor who can handle their investments with confidentiality. Choose an advisor, who is unbiased, can offer you mutual fund products from all fund houses.
It is important to know the past track record of the person whom you entrust your money with. What field was he working in, what knowledge does the advisor possesses.There is no formal rating or ranking system for mutual fund distributors in India.
Hence in this scenario, the best way is to ask around for referrals. Use social media websites, to understand if anyone has recommended the advisor or his firm. That will give you some idea of his strengths. Check online for referrals, ask your friends or relatives for references, how long the advisor has been in business and his way of operating.
A good advisor needs to be compensated well. Ask your advisor if he uses a distribution model, where he gets commission from the fund house for every investment that you make. Alternatively, some advisors charge you a fee for the service, depending on the time they have to spend with you or your personalised requirements.
There are many online portals that do help you make a Financial plan, by gathering data from you and it could be free, while there are seasoned financial planners who could charge a fee for the same. A comprehensive financial plan, requires effort to make and it takes into account your risk taking ability, future needs and life goals.
From a regulatory perspective, distribution is seeing a lot of disruption. Traditional distribution, or the agentdriven model, which is fragmented is subject to a lot of challenges and regulations are slowly moving in favour of digitisation. Though offline mode is still a large contributor, online transactions are picking up due to easing regulations and higher acceptance of the product. Few like us fincash.com are in online category.
below is the list of best mutual funds ordered based on 3 year performance and having net assets > 500 Crore.
Fund NAV Net Assets (Cr) 3 MO (%) 6 MO (%) 1 YR (%) 3 YR (%) 5 YR (%) 2018 (%) SBI Banking & Financial Services Fund Growth ₹19.5764
₹1,128 12.3 10.3 25.7 19 9.5 TATA India Consumer Fund Growth ₹17.6558
₹1,396 10.4 9.8 2.5 18.7 -2.1 Axis Bluechip Fund Growth ₹31.63
₹8,050 9.1 14.4 23 18 10.7 6.5 Franklin India Feeder - Franklin U S Opportunities Fund Growth ₹33.2391
₹961 1.3 8.8 15.6 17.9 12.5 6.5 Axis Focused 25 Fund Growth ₹30.53
₹8,384 11.2 16.1 20.3 17.6 12.9 0.6 Mirae Asset Great Consumer Fund Growth ₹36.98
₹873 13.8 12.8 14 16.4 12.1 1.9 Axis Mid Cap Fund Growth ₹39.39
₹3,200 12.2 13.9 16.2 16 10.9 3.5 Mirae Asset Tax Saver Fund Growth ₹18.541
₹2,465 9.1 10.3 14.4 15.8 -2.3 Axis Long Term Equity Fund Growth ₹49.0154
₹20,425 11.3 15.6 19.9 15.8 12 2.7 Sundaram Select Focus Fund Growth ₹189.153
₹1,006 7.3 9 15.5 14.8 8.4 1.2 Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 14 Nov 19
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