Question 1

What is a Direct Mutual Fund plan?

Accepted Answer

A Direct plan is a version of a mutual fund where you invest directly with the fund house — without any distributor or agent in between. Because there's no middleman, the fund house doesn't pay any commission, which means your expense ratio is lower and your returns are higher. The fund itself is identical; you just keep more of the profits.

Question 2

Will my returns really improve by switching to Direct?

Accepted Answer

Yes, absolutely. Direct plans have a lower expense ratio — typically 0.5% to 1% less than regular plans. While that sounds small, the compounding effect over 10–20 years is massive. On a ₹10 lakh portfolio, that difference can add up to ₹20–50 lakhs over 20 years. Use our calculator above to see your exact numbers.

Question 3

How do I switch from a Regular plan to a Direct plan?

Accepted Answer

Switching is straightforward. You can either redeem your regular plan units and reinvest in the direct plan, or do a direct switch within the same fund house. There may be exit loads or tax implications depending on how long you've held the units. Our advisors at AC Agarwal will guide you through the entire process — just WhatsApp or call us.

Question 4

Is there any risk in switching to Direct plans?

Accepted Answer

The underlying fund and its risk profile remain exactly the same. The only difference is the expense ratio. However, switching may trigger capital gains tax if your units have appreciated. We recommend consulting our advisor before switching to plan the move in the most tax-efficient way.

Question 5

Do I lose expert guidance if I go Direct?

Accepted Answer

Not with AC Agarwal. We provide SEBI-registered investment advisory services separately from commissions. You get professional fund selection, portfolio review, and rebalancing advice — without the hidden 1% annual cost baked into your returns. You pay for advice transparently, not through a silent commission drain.

Question 6

What is the 1% commission and who pays it?

Accepted Answer

When you invest in a Regular mutual fund plan, the fund house pays your distributor (broker/agent) a trail commission of roughly 0.5%–1% of your portfolio value every year. This comes directly out of your fund's NAV — meaning you're paying it whether you know it or not. On a ₹50 lakh portfolio, that's ₹50,000 silently leaving your account every single year.

Question 7

How long does it take to switch to Direct plans?

Accepted Answer

The actual switch typically takes 2–5 business days after you submit the request. Our team at AC Agarwal handles all the paperwork and coordination with the fund house. Most clients are fully switched within a week. We'll keep you updated at every step.

Question 8

Is AC Agarwal SEBI registered?

Accepted Answer

Yes. AC Agarwal Share Brokers Pvt. Ltd. is a SEBI registered broker with registration number INZ000216930 (NSE/BSE/MCX) and has been in operation since 1994 — over 30 years of trusted financial services. Your investments are safe and fully regulated.

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