If you are new to mutual funds or don’t have the time to dig deep, it is quite natural that you would be utterly confused while choosing the right mutual fund plan that matches your financial goals. The market is flooded with numerous mutual fund plans which have a diverse range of categories and sub-categories that cater to different asset classes, investment styles, themes, risk profile, etc. This makes it especially tough to zero in on the right plan. The role of a financial advisor who sometimes also is a mutual fund distributor is to help his/her clients make the right financial decision. Of course this advice is not for free. The fee of a financial advisor comes from mutual fund asset management companies (AMC) in the form of upfront and trail commission. Asset management companies pass on these costs to their customers in the form of expenses that reduce the net asset value (NAV) of the underlying plan. That is the primary reason that buying a mutual fund directly from the AMC is cheaper then opting for a direct plan through a financial advisor/mutual fund distributor.
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