There are various ways in which you can invest in a mutual fund online. Some these include
Doing it through your broker
This is the easiest and the best way to invest in a mutual fund scheme. For example, Sharekhan offers you the facility to buy a mutual fund scheme online.
For example, if you have sufficient funds to make purchases then you need to do it as follows:
- Click on trade and investment
- Select the mutual fund
- Click on purchase
- Select the mutual fund from the list provided
- Click go and you will see the various funds of the asset management company
There are plenty of independent websites that can offer you the facility for investing in a mutual fund scheme online. But, it's almost difficult to pinpoint any unique characteristics of any one of these.
Mutual Fund Websites
You can invest in a particular mutual fund through each of the fund's website. But, the problem here is that you have to register with each website and if you want to invest in five or six different schemes of different mutual funds, you will have to register at five or six different mutual fund websites. This can be tedious and time consuming.
There are no problems as such in investing online, but if you have not completed the know your client formalities, you would have to hand the documents physically.
The online transactions that are possible from a mutual fund would include:
- Subscribe or buy
- Invest in NFO
- Additional Purchase
It's important to check various aspects before investing in a mutual fund like the past track record, the type of scheme you would like to invest in etc.
For example, you may prefer a debt scheme over a mutual fund scheme. To read more on how to choose a mutual fund scheme read "How to choose the right mutual fund scheme?"