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New to investing and financial planning?

Read everything you need to know about equity, mutual funds, and investment before you get started.

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FAQs

Investment Process

  • Obtain an application form along with the Offer Document from your investment advisor / broker / agents, download it from our website or procure it from any of offices or investor service centres
  • Read and understand the Offer Document and complete the application form
  • Attach a cheque OR transfer the money electronically
  • The completed application can be mailed to or dropped off at any of AMC offices or investor service centres

The following is a list of documents required by an investor while investing in mutual fund for the first time.

For Individual Investors:
  • PAN Card Copy
  • Address Proof
  • 1 Passport sized photo
List of mandatory documents to be submitted are
Company / Body Corporate
  • PAN Card Copy
  • Address Proof – Electricity Bill / Bank Statement
  • Balancesheet of last 2 financial years
  • Certificate of Incorporation
  • Memorandum and Articles of Association – MOA & AOA
  • Resolution of the Board of Directors
  • Authorised signatories list with specimen signatures
  • Photograph, POI, POA, PAN of each Authorized Signatory
Hindu Undivided Family (HUF)
  • PAN of HUF
  • Deed of declaration / List of Coparceners
  • Latest Bank Passbook / Latest Bank Account Statement
  • Photograph, POI, POA, PAN of Karta
Partnership Firm
  • Certificate of Registration
  • Partnership Deed
  • Documents evidencing authority to invest
  • Authorised Signatory list with specimen signatures
  • Balancesheet of last 2 financial years
  • Photograph, POI, POA, PAN of each Partner
Trusts, Foundations, NGOs, Charitable Bodies, Clubs / Mutual Fund Schemes
  • Certificate of registration
  • Trust deed
  • Authorised Signatory list with specimen signatures
  • Copy of Constitution / Registration documents
  • Balancesheet of last 2 financial years
From Minor to Major:
  • Written application with the signatures of minor and guardian.
  • New bank details
  • Self-attested copy of PAN& Address Proof
  • Birth Certificate of Minor
From Minor to Major:
  • Certificate of Registration issued by Registrar of LLP
  • Permanent Account Number (PAN)
  • LLP Agreement
  • Communication address proof of the entity – Electricity Bill/ Bank Statement of latest 3 months
  • Permanent Account Number (PAN) if not provided earlier
  • Photograph, POI, POA, PAN of each Authorized Signatory
  • In case Power of Attorney (POA) has been granted for Account operations, photograph and identity and address proof of the POA holder should also be submitted
  • Shareholding pattern / List of beneficial owners holding more than 25% in the company. (Directly / Indirectly)(on letterhead)

Details required: Income Range, Nature of Business, Networth of Corporate, Email-ID, Mobile Number, Bank Details etc.

The Application can be mailed to or dropped off at any of the offices of AMC or investor service centers.

Parents / Lawful Guardians can apply on behalf of a Minor. They can sign the application on behalf of the Minor and status of the Investor in the Account Statement would also reflect the same.

Yes, investments can be made in joint names.

Two joint names are permissible.

When an investment is made in joint mode of holding, it means the units are in both the names and transactions needs signature of both. On the other hand, when one opts for either or Survivor, it means the units are in both the names. However, transaction can be carried out by either of the individuals. Further, in case one of them has died, the transaction does not stop. But in the case of joint holding, if one of them has died, the living individual has to submit the dead certificate along with an application to the AMC. Thus,“either or survivor” is a better option.

Yes. The nomination can be made by individuals applying for / holding units on their own behalf singly or jointly. Non-individuals including society, trust, body corporate, partnership firm, Karta of Hindu Undivided Family, holder of Power of Attorney cannot nominate.

Yes, there is a cut-off time before which the investor should submit the transaction so that he can takeadvantage of that day’s NAV.

Yes, PAN is mandatory when the investment s Rs.50,000 or more.

The cost of the fund management process that includes marketing and initial costs are charged when client enters the scheme. These charges are termed the entry load.

Just like entry load some funds impose a fee when aclient leaves the scheme.

Lock-in period is a time span during which the money invested cannot be redeemed. In the case of open-ended funds there are no lock in periods.In case of tax saving funds, a minimum lock-in period of 3 years is applicable.

Yes, limits of minimum amount are applicable for additional purchases for schemes and will be mentioned in the Offer Document.

Some Mutual Funds provide investor with an option to shift his investment from one scheme to another within that fund.This option is known as switching.

Investors can opt to switch units between Dividend Plan and Growth Plan at NAV based prices. Switching is also allowed into/from open-ended schemes currently within the Fund family or schemes that may be launched in the future at NAV based prices.

While switching between Debt and Equity Schemes, one has to take care of exit and entry loads. Switching from a Debt Scheme to Equity scheme involves an entry load while the vice versa does not involve an entry load.

Switches are subject to loads depending upon the Scheme details.

One needs to complete a transaction slip, which can be downloaded from website or detached from the bottom of the account statement. A switch from one scheme to the other is treated as redemption from the scheme from where it is switched out & a purchase into the scheme into which it is being switched. Thusone will be liable for any ‘applicable’ entry load or exit load, as the case may be.

Yes, the target scheme will have the minimum subscription amount as specified in the Offer Document.

Switch requests are affected the day the request for switch is received. The Applicable NAV for the switch will be the NAV on the day that the request for switch is received.

SIP ( Unique Method of Investment )

A Systematic Investment Plan (SIP) is a simple method of investing, used across the world as a means to accumulate wealth. It works onthe same way as a recurring deposit account. SIP involves investing a fixed sum of money in a specific investment scheme, on a regular basis, for a pre-determined number of periods.

  • Helps you to invest disposable funds each month.
  • Gives you the benefits of rupee-cost averaging
  • Relieves you of trying to time the market
  • Helps you to reach your financial goals
  • Fill up a single SIP form, and a single application form.
  • Per cheque minimum SIP amount, there are many funds that have their minimum amount as low as can be as low as Rs 500/-
  • Auto Debit Facility

Yes, there is a minimum amount limits for subsequent purchase in same scheme.

Statement of Account

A document issued by the mutual fund, which gives details of their transactions and holdings of an investor.

Mutual funds are required to dispatch certificates or statements of accounts within six weeks from the date of closure of the initial subscription of the scheme. In case of close-ended schemes, the investors would get either a demat account statement or unit certificates as these are traded in the stock exchanges. In case of open-ended schemes, a statement of account is issued by the mutual fund within 30 days from the date of closure of initial public offer of the scheme. The procedure of repurchase is mentioned in the offer document

Yes, you can get email communication instead of the physical communication of the following:

Account Statement, OR

Quarterly Newsletter & Annual Report, OR

Communication on change of Address, Bank, etc.

You need to provide your email id and subscribe for the above at the time of investing by ticking at the relevant column of the application form / common transaction form.

Yes, you can consolidate multiple accounts in a fund. The pre-requisite for consolidation is that all static details like Address, Bank, Mode of Holding; Unit holders etc… have to be identical across all accounts in a fund. Upon receipt of a valid request, consolidation into a single account would take place.

An account statement can be obtained from the following sources: –

  • Requesting any of the CAMS SERVICE Centers
  • Writing / email / phone to back office at CAMS or its SERVICE Centers
  • Requesting through CAMS Website under Account Information –
  • Email robot service sends the account statement to the registered email id in no time
  • Requesting through CAMS Website under Query / Complaints –
  • Email / physical account statement would be sent to the Investor at their registered address

You have to inform the nearest CAMS SERVICE CENTRE / concerned AMC in writing, appropriately signed, so that they can make changes in the database. Alternatively, you can submit a request at the CAMS website to record the change by logging on to the Account Information with a PIN reference under Investors section. An acknowledgement will be sent reflecting the change

You have to inform the nearest CAMS SERVICE CENTRE / concerned AMC in writing, appropriately signed, so that they can make the changes in their database. Alternatively, you can submit a request at the CAMS website to record the change by logging on to the Account Information with a PIN reference under Investors section. An acknowledgement will be sent reflecting the change.

Dividend & Redemptions

Dividends would be paid by cheques, drawn in the name of the sole holder/first-named holder (as determined by the account and mailed to the last address recorded in the books). The Bank name and the Account no. as specified in the records will also be mentioned in the cheque. The cheque will be payable at par in all the cities designated by the Fund. In case of other cities, you will be paid by a Demand Draft after deducting the demand draft charges (if any and depending upon the concerned AMC).

Dividends would be paid through Direct Credit to Investors’ Registered Bank Accounts.

It is combination feature of both growth and dividend plan. Dividends are declared as in a dividend plan. But are not received instead are reinvested in the scheme

No, there is no load on re-investment of dividends into the same fund. In a dividend reinvestment plan, the dividend is reinvested in the scheme itself. Hence instead of receiving dividend, the unit holders receive units. Thus units would be allotted under the dividend reinvestment.

Write a letter to AMC for not receiving the dividend.

In an open ended fund investments can be redeemed any time but in the close ended fund investments can be redeemed only after the expiry of the lock-in period, either by submitting a physical request to any of the Karvy/CAMS SERVICE CENTREs / concerned AMC or requesting the same through the on-line services available under Investors section at the CAMS website.

A mutual fund is required to dispatch to the unit holders the dividend warrants within 30 days of the declaration of the dividend and the redemption or repurchase proceeds within 10 working days from the date of redemption or repurchase request made by the unitholder.

In case of failures to dispatch the redemption/repurchase proceeds within the stipulated time period, Asset Management Company is liable to pay interest as specified by SEBI from time to time (15% at present).

It is the charge collected by the scheme when it buys back the units from the unit holders.

The unit holder may set up a Systematic Withdrawal Plan on a monthly, quarterly or semi-annual or annual basis to redeem a fixed number of units. They have to pay capital gain tax, which may be short term or long term. Any Unit holder can avail of this facility subject to the terms and conditions contained in the application form / Offer Document, it may also include exit loads if applicable.

You can write / email to any of the Karvy/CAMS SERVICE CENTREs or to the AMC concerned addressing the same for further course of action.

Taxations

Dividend Income from the Debt and Fund of Funds schemes only will attract the dividend distribution tax @ 12.5% for Individuals and 20.00% for the non-individuals. The dividends in the hands of the investor will be completely tax-free. However, the Debt-oriented funds have to pay the DDT while Equity oriented funds exempt from it.

It is tax is paid by the investor to the tax authorities while they filing the income tax returns. More over the capital gains of the equity oriented funds are exempt from tax if your holding period exceeds one year. When you sell any asset you own (house, land, shares, mutual fund units, gold, debentures, bonds), and you make a profit on the sale, it is known as capital gain.

Equity oriented funds are subject to securities transactiontax at the rate of 0. 2 percent at the time of selling the funds units. This charge is deducted when you redeem your investments.

Dividend income from mutual fund units will be exempt from income tax with effect from July 1, 1999. Further, investors can get rebate from tax under section 80 (C) of Income Tax Act, 1961 by investing in Equity Linked Saving Schemes of mutual funds.

These are funds that invest in shares of companies (diversified equity funds and sector funds). They also include balanced funds, which have more than 65% of their total investments in equity. Dividend income from an equity-oriented fund is tax-free.

If you sell the units within a year of buying, it will attract a short-term capital gains tax of 10%.

If you sell the units after a year, no long-term capital gains tax.

While dividend income is tax-free in the hands of the investors, it attracts a dividend distribution tax of 12.5% (plus surcharge and cess) paid by the mutual fund, has to be is borne by investors.

If you sell the units after a year, you will have to pay a long-term capital gains tax of either 10% without indexation, or 20% with indexation, whichever is lower. Indexation is used to calculate tax when inflation is taken into account. This is good because it reduces the amount of capital gain and the amount you end up paying as tax.

If you sell the units within a year, the short-term capital gain will be clubbed with the income of the individual investor, to be taxed as per the slab system.