Will not investing in MF at IPO(NFO) stage help you get higher dividends if it is a dividend scheme since the dividends are payable on the face value of the Unit?
Mutual fund agents are supposed to be registered with AMFI. The person who is trying to sell me MFs shys he is registered with AMFI. What does that mean?
RE:Mutual fund agents
by Milind Karnik on May 27, 2005 01:44 PM
AMFI = Asoociation Of Mutual Funds Of India.
Govt. has realised that in most of the financial transactions at individual investor level, an agent / distributor plays an important role. So, nowadays there are prescribed exams that would-be agents need to clear. These are applicable for Insurance agents [IRDA], MF agents [AMFI] as well as stock market trades / dealers [I am not aware of these in detail].
Only after clearing AMFI test, can one become a MF agent. There is one exception though - recently, UTI has re-appointed there ole [literally] agents - those who are above 60 years of age.
Now some one may find this as a bad precedent, as this may amount to compromising the basic premise of such tests; what if a person get re-appointed as an agent under this scheme and then his son / daughetr or anyone appoited by him transacts?
Very poor article.... Articles such as this which are a combination of half truths really scare retail customers away from Mutual Funds.
I guess the only way to prevent agents from mis-selling and churning the portfolio of their clients is to introduce trail commissions for equity funds whereby the agent gets paid for the period the customer stays invested. Currently since agents get paid upfront commission on equity MF, it encourages them to churn the portfolio aggressively for higher brokerage payouts.
I am surprised at the tall tales some of these agents tell to acquire investments in schemes(correctly pointed out in the article , which fetches THEM maximum commission) which are proven useless. I was lured in invest in SBI Magnum in 2000. I invested Rs.10,000/ I got back Rs.4114 after 3 years of the lock-in period(A whopping 60% meltdown of my investment). I gave standing instructions to bar entry of these agents into my office.
