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What Is The Procedure To Invest In Mutual Funds Online?


To invest in mutual funds you have to know the procedure to invest in a long term commitment in funds. You just need to follow this simple procedure to invest in mutual funds online. When you invest in mutual funds, there are two simple levels of procedure you must flow and also go through.

  • First one is a normal regulatory basic process
  • A second process is an approach in which you have to protect the value of your portfolio.

Let us have a quick look at these two procedures first.

  1. Basic Process to Follow for Investing in Mutual Funds
  • The first step is to complete KYC after doing the procedure to invest in mutual funds online. KYC stands for Know Your Client; this ensures that you understand all the risks and all rewards of investing in the mutual funds.
  • Second, comes in your mind how you can do KYC, so there are two ways, the first way is you can go to the registrar office or branch office of the fund and do a physical KYC. The second way is, you can easily use your Aadhar card that is linked to your PAN number and do e-KYC.
  • After KYC is done, the mutual fund is welcoming to invest. You can hire a broker and go through him or you can directly go and give a Direct Application to the office of the mutual fund. 
  • After giving a Direct Application, you pay lower Total Expense Ratio (TER) and hence your NAV will be higher. If you go through the broker you will have an advisory service in the selection of funds. If you are that much confident to manage your whole mutual fund investments on your own, then only go for Direct Plan. Otherwise please take expert assistance.
  • If you are not able to do physical mode, you can also go for the online procedure to purchase the mutual funds. There is also one more option to go to their website and purchase mutual funds on their website. On their websites, mutual funds are allocated in ISIN numbers. In your Demat account, you can easily hold your mutual funds along with your equity shares and other similar assets.

Secondary Process to Follow for Investing in Right Mutual Funds

  • The primary process that shows us how to enter in mutual funds world, it’s a like a first step, here we are discussing to invest in the right funds.
  • Here you have to ensure that the fund you are going to invest is suited your risk appetite. You should think about how your portfolio should be built. For that, you should go for the best way that is a big financial plan, and allocate that in specific asset classes. 
  • Your second step should go for SIP and do lump-sum investment. SIP stands for systematic investment plans, and it best for wealth creation, in the case when it comes to long term process.
  • The last process is, before doing the final investment; you should give a complete look to your fund factsheet. Always keep in mind about risk factors, TER (Total Expense Ration) and portfolio mix in long term performance.

For a good start with your mutual fund investment process must have a combination of the regulatory process and the analytical process. If you flow the above procedure to invest in mutual funds online that will a good start to your investment journey.

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