The Mutual Funds Investment Thread

[whitestar_999]

These are 5 agencies authorized by SEBI for CKYC verification & verification by any one of them is required(& not all of them). You can start investing in any MF now by going to MF site & creating an account by entering pan number. You will receive an otp on your mobile number & email address mentioned in the ckyc form you submitted(aka your DSP tax saver fund application) for confirmation & after that your acc will be ready for investing in that MF. Read my above post about difference between Regular & Direct versions of a MF plan. All MFs are legally required to provide both versions on their own site but not necessarily on other/3rd party site.e.g. ICICI MF site will give you options for both regular & direct versions of a MF for its own MF but not for any other MF like hdfc or axis etc which will have only regular version.

First check whether your DSP tax saver fund is Regular or Direct(it must have Direct in its name) & if it is regular then you can switch it to direct version on their site(aka DSP MF site).

 

[omega44-xt]

Then you will have to get CKYC verified first. Demat acc is mainly for share trading & is not required for MF investment except in rare cases where broker keeps MF units in demat acc(like zerodha). Don't spend too much on demat+trading acc with major names like axis,sbi,hdfc,icici,kotak because their brokerage charges are quite high & only worth it if you do a significant amount of share trades regularly. May be Axis demat acc opening procedure will get you CKYC verification too(especially if you already hold axis bank acc) but still confirm it with their customer care preferably via email. In case they confirm then register an acc on axismf & directly start sip in their Axis Blue Chip MF direct version which is mentioned in above youtube video(all MF have 2 versions: Regular(which has more commission charges) & Direct(less commission charges), all direct versions have Direct in their name but not all Regular versions have Regular in their name. Another classification is Growth version & Dividend version out of which always take Growth version only).

A friend of mine does invest in MF & directly in stocks. HE recommended me an Axis MF as well & recommended me to open Demat at axis as I have an account with them. He said it would be convenient for me & once I learn stuff I can decide for myself how to trade & from where.

Will surely keep those points in mind.

 

[whitestar_999]

A friend of mine does invest in MF & directly in stocks. HE recommended me an Axis MF as well & recommended me to open Demat at axis as I have an account with them. He said it would be convenient for me & once I learn stuff I can decide for myself how to trade & from where.

Will surely keep those points in mind.

There are many axis MF, select axis bluechip mentioned in youtube video I posted earlier. I also gave advice in that post but repeating it again here. Do not put more money than you can afford to lose in direct stock trading & never invest solely based on "friend's or relatives advice" even if they are running in lakh+ of profit currently(aka I doubt a person will have pro stock traders in their family/friends & still asking about it online,one but not the only sign of a pro in stock trading is he will be holding no other job & would be making his money entirely from stock trading).

 

[omega44-xt]

There are many axis MF, select axis bluechip mentioned in youtube video I posted earlier. I also gave advice in that post but repeating it again here. Do not put more money than you can afford to lose in direct stock trading & never invest solely based on "friend's or relatives advice" even if they are running in lakh+ of profit currently(aka I doubt a person will have pro stock traders in their family/friends & still asking about it online,one but not the only sign of a pro in stock trading is he will be holding no other job & would be making his money entirely from stock trading).

Obviously its risky.

 

[Zangetsu]

All mutual funds are in negative state due to this Pandemic and Economic loss. Best time to buy funds for investment as the NAV will be lower.
Market will get stable in future.

 

[omega44-xt]

All mutual funds are in negative state due to this Pandemic and Economic loss. Best time to buy funds for investment as the NAV will be lower.
Market will get stable in future.

That's why many are hopping into it now. Read an article stating that a lot of demat accounts were opened during the lockdown.

 

[Zangetsu]

Yup, this is Bear Market situation and people will wait for Bull Market to make profits.

 

[whitestar_999]

Obviously its risky.

Yes but I can assure you it is very easy to fall into the trap. I have seen people earning 10k+ in 1-2 days only to end up losing more than that later. It is completely possible that tomorrow you invest 5k thinking as small amount to invest in some company based on some random online tip & end up making 3-4k profit & this happens 2-3 times in a row making all your cautions to go away.

 

[whitestar_999]

Yup, this is Bear Market situation and people will wait for Bull Market to make profits.

One of the classic trap of the stock market, thinking that you can perfectly time the market to buy in bear market & sell in bull market. Rest assured unless you at least lose a few thousand in the beginning you will never understand this trap(seen people losing lakhs btw in this trap so losing a few thousand to understand this trap is a good deal). You invest in MF keeping at least 10+ years in mind & for a specific financial goal(retirement corpus, education expenses etc), never invest in MF with a mentality of FD like savings & 4-5 years of investment unless you consider yourself an expert in stock market. Even less need to be said about directly investing in shares which is at least 10 times riskier than MF.

 

[Vyom]

Today I tried opening account with Zerodha.
It asks for online photo verification where I need to hold a paper in my hand with the OTP they provided and it will take picture. But I didn't have any webcam on my PC. (What is in person verification and why is it needed?)

There was no alternative way to verify either. Anyone of you have zerodha account? Is this a new requirement?

 

[whitestar_999]

Today I tried opening account with Zerodha.
It asks for online photo verification where I need to hold a paper in my hand with the OTP they provided and it will take picture. But I didn't have any webcam on my PC. (What is in person verification and why is it needed?)

There was no alternative way to verify either. Anyone of you have zerodha account? Is this a new requirement?

Yes in-person verification is needed for all financial institutions accounts as per sebi & rbi guidelines because otherwise it would become a haven for money laundering. I did the same when I opened my zerodha acc. Use a laptop.

 

[FinancialMohan]

I was looking out to invest in SIPs of low amounts and found the following funds:

• SBI Gold Direct Plan
• Axis Bluechip Fund Direct Plan-Growth
• HDFC Gold Direct Plan-Growth
• DSP Government Securities Direct Plan-Growth
• Franklin India Banking & PSU Debt Fund Direct-Growth

I have thought about going ahead with Axis Bluechip Fund & Franklin India one. However, people have advised me to invest in gold funds as well. What do you think is the benefit of including gold funds in my portfolio?

 

[whitestar_999]

I have thought about going ahead with Axis Bluechip Fund & Franklin India one. However, people have advised me to invest in gold funds as well. What do you think is the benefit of including gold funds in my portfolio?

For hedging/diversifying. Gold is also considered a good bet during times of economic downturn & considering how the coronavirus situation is developing it is better to put ~15-20% of your investment in gold in my opinion.

 

[Vyom]

How is zerodha's commodity trading option to invest in gold?

 

[whitestar_999]

How is zerodha's commodity trading option to invest in gold?

Stay away from commodity/futures/options, these are for experts only(aka if you need to ask then you are not one). Stick to gold MFs or buy sovereign gold bond.

 

[Vyom]

For Future/Options you need capital in addition to skill. So, for that I agree.
But not sure why commodity trading is for experts? Is it unlike normal trading?

 

[whitestar_999]

For Future/Options you need capital in addition to skill. So, for that I agree.
But not sure why commodity trading is for experts? Is it unlike normal trading?

Actually for future/options you need even less capital because of large margins given(now reduced though) so much more chances of incurring heavy losses(e.g.a few thousand rupees in acc is enough to make a future/option trade worth tens of thousands with chances of incurring similar profit/loss in tens of thousands).

Commodity trading also relies mainly on futures/options, why do you think it needs a separate proof of income/documents for activating futures/options/commodity in any brokerage account.

*www.investopedia.com/investing/commodities-trading-overview/

 

[mitraark]

Today I tried opening account with Zerodha.
It asks for online photo verification where I need to hold a paper in my hand with the OTP they provided and it will take picture. But I didn't have any webcam on my PC. (What is in person verification and why is it needed?)

There was no alternative way to verify either. Anyone of you have zerodha account? Is this a new requirement?

I opened the link on mobile, Google Chrome. It works.

 

[mitraark]

I was looking out to invest in SIPs of low amounts and found the following funds:

• SBI Gold Direct Plan
• Axis Bluechip Fund Direct Plan-Growth
• HDFC Gold Direct Plan-Growth
• DSP Government Securities Direct Plan-Growth
• Franklin India Banking & PSU Debt Fund Direct-Growth

I have thought about going ahead with Axis Bluechip Fund & Franklin India one. However, people have advised me to invest in gold funds as well. What do you think is the benefit of including gold funds in my portfolio?

All are ok for SIP now except the last one in my opinion. Banks are going to feel the brunt of unpaid loans in near future because people are losing earnings in lockdowns. Go for bonds or govt securities funds. Gold is a good bet but you should know its already skyrocketed in the last 12 monhts, upside may be limited, so limit its percentage if youre looking for gains.

Risky players can explore pharma funds/stocks/smallcases, they might be doing good business in the COVID-19 aftermath.

 

[TheSloth]

Largecap : Hdfc index fund sensex plan
Multicap : Parag Parikh Long Term Equity Fund and Invesco India contra fund
Smallcap : Axis small cap
ELSS : Mirae Asset

I plan to start investing this year since I have repaid one loan and I have money that monthly loan amount to invest. I already have one ICICI Direct account, should I use that OR should I open account from the official pages of funds say, one account for Mirae and another for Axis blue chip? Under ICICI Direct account, isn't it easy to see all investment on same website instead of maintaining several login accounts?

I am looking for inputs here on my understanding so far .
Isn't it better to start with ELSS and then add Large Cap fund investment since ELSS has tax deduction benefit under 80C and good return rates as well in case anyone wants to continue more than 3 years.