Contents
A Mutual Fund Distributor/Mutual fund agent is qualified and trained to set a connection with the investors. Recognize their needs. They select the Best Mutual Fund having features that best suit the needs. And recommend. According to your needs, he will also be able to suggest ways to invest. To sell mutual funds distributors registers with mutual fund agencies. How much diversification is required and recommended and the best plans to invest in?
Once the portfolio has been selected and invested in. Regular monitoring of the Mutual Funds Investment schemes and portfolio are required. It is an on-going job. A Mutual Fund Distributor/financial advisor helps you review these schemes too.
To become a Mutual Fund Distributor, you would have to get registered with the AMFI (Association of Mutual Funds in India). After passing the NISM Certification Test. After registration, you would be issued a Unique Code – ARN Code (AMFI Registration Number). SEBI has made this registration mandatory. In order to ensure that the best ethical standards are practiced.
Mutual Funds
Mutual funds are an investment program funded by shareholders who trade in diversified holdings and are professionally managed. Also, it is a kind of common fund created which is invested in one or many asset classes like equity, debt, liquid assets, etc.
It is called ‘mutual’ fund because all the risks, rewards, gains or losses pertaining to or arising from the investments made out of this savings pool are shared by all investors in proportion to their contributions. Mutual funds are registered under SEBI (Securities Exchange Board of India) which approves the Asset Management Company (AMC) which is managing the fund.
Mutual Funds are designed for every individual investor diversification and money management, even for small investors who invest low amounts. Mutual funds are an appropriate investment option to consider for investors who just began investing, if you don’t have a lot to invest, or if you want diversification in your portfolio.
Mutual Fund Eligibility
Education Qualification
To become a Mutual Fund agent the minimum requirement is NISM Series VA Mutual Fund Distributors Certification. And so a registration number from the Association of Mutual Fund in India(AMFI)
- The minimum qualification to give this exam is class 12 or class 10 with 3 years of diploma.
- Age Limit: The candidate should be of 18 years or above to become a Mutual Fund Agent.
Required Skills
To be a Mutual Fund Agent the aspiring candidates must have given skills:
- Mutual Fund Agent needs to streamline quantitative research for interest rates.
- In addition, The agent knows how to analyze debt and loan portfolio performance.
- Mutual Fund Agents have to know how to perform credit appraisal with global practices.
- Moreover, The agent enhances the Basel based internal rating system.
- Mutual Fund Agent has to know how to generate better trade ideas & identify problem loans.
- As well as Mutual Fund Distributor should build & maintain credit risk models.
- Also, The Agent amplifies the credit monitoring system of clients.
- They should make lending and investment recommendations.
- Also, Agents should know how to design credit strategy and credit portfolios.
How to become Mutual Fund Distributor in India
Step1-Pass the NISM series V-A: Mutual fund distributor certification Exam
There are no certain minimum eligibility criteria for becoming a Mutual Fund Distributor. Any person who is able to pass the NISM mutual fund distributor certification exam is eligible for becoming the Mutual fund Advisor. As per the NISM site, only 60% of the exam givers are able to clear the exam. So who takes this exam casually is not able to pass the exam. There is an exemption to the people who are 50 years and above(as on 1 June 2010). There is a one-day training program by NISM called NISM Continuing Professional Examination(CPE) earlier known as AMFI Refresher Course. Fees for Mutual fund distributors certification exam is Rs 1500 and for NISM CPE is Rs2500 and the certificate gets to deliver in 10 days.
Step 2-Register through AMFI through CAMS office
Once you pass the NISM series V-A, you will be eligible to be a mutual fund distributor. After this, you will be undergoing Know Your Distributor(KYD) procedure along with AMFI Registration Number(ARN) registration form. This form requires your details such as name, address, qualification, photograph, NISM Mutual fund distributor exam details, bank details, payment details. The fees for an individual is Rs 3000 and the payment is done through demand draft.
Duly filled forms need to be submitted to the CAMS office. If you are not a KYD compliant you are required to be physically present in the CAMS office for submitting the form with biometrics. Once the procedure is completed you will receive your ARN number within a few days at your registered address.
Step 3- Register with AMCs
Once you got your ARN number you are free to distribute the mutual funds without any problem and receive a commission. But there is a small but tedious procedure left. You will need to register with each mutual fund house so that you can get a commission, application form, and marketing material. There is more than 40 mutual fund agency and you may select a 5-6 mutual fund agency to register such as HDFC mutual fund, Reliance Mutual fund, ICICI Prudential mutual fund, Birla Sunlife mutual fund, Axis mutual fund, SBI mutual fund, BNP Paribas mutual fund, etc. Alternatively, you can get register with a national distributor than going to each and every mutual fund house. This will save you from the hassle to go each and every mutual fund house for registration.
FAQs
Q1-How much commission does mutual fund agents make?
A first commission is a direct commission paid to the agent for the services. This amount is between 0.5% to 2%. An upfront commission is a commission paid by the asset management companies to the agent for the first year. The commission rate varies from fund house to fund house and type of mutual fund. Trail Commission is the main source of earning for many mutual fund agents. Trail commission is the commission paid to an agent by asset management companies.
Q2-How do mutual fund advisors earn?
A financial advisor receives a trail fee, which is a fixed percentage of a client’s investment in a mutual fund, as long as their client’s money remains to be invested in the fund. Also, financial advisors are paid out of the front- or back-end loads that a mutual fund charges when its shares are bought or sold. Financial advisors also receive a small percentage of these load fees that are negotiated between a mutual fund and its advisor via Mutual fund agency.
Q3-How do beginners invest in Mutual funds?
The best way to invest in mutual funds is through systematic investment plans (SIPs). SIP allows you to purchase units of your selected mutual fund as per your budget at fixed intervals (typically, once a month). You can link SIP with your bank account for automatic debits.
If you are new to Mutual Funds Distribution and finding the journey overwhelming. Get registered with WealthBucket. Increase your base. Get introduced to and deal with products from a variety of AMCs and Fund Houses.
We have a vast variety of Mutual Funds being dealt. Be it Balanced Mutual Funds, Liquid Mutual Funds, Income Funds, or Equity Mutual Funds,
Call NOW +91 9999379929. Or email for more details at contact@wealthbucket.in
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