How to Switch from Regular to Direct Mutual Fund

Are you considering investing in mutual funds? Do you want to understand the difference between direct and regular mutual funds? This comprehensive guide will provide you with everything you need to know about these investment options and guide you through the process of switching between them.

Direct Mutual Funds vs. Regular Mutual Funds: Making the Choice

When it comes to investing in mutual funds, you have two options: direct funds and regular funds. Direct funds involve a direct investment with no intermediary, resulting in no commission fees. On the other hand, regular funds are accessed through intermediaries like distributors or brokers, making them suitable for investors seeking convenience. Direct plans often appeal to market-savvy individuals who wish to maximize returns by avoiding commissions.

How to Switch from Regular to Direct Mutual Fund?

Switching from a regular mutual fund to a direct one is a simple process. If you prefer online methods, log in to your mutual fund account and choose the ‘switch’ option to move to a direct plan. Alternatively, visit the fund house’s branch or use an intermediary for an offline switch. Just remember, the change might take up to four working days to reflect.

Switching from Direct to Regular Mutual Fund: Why and How

For some investors, managing a direct mutual fund portfolio can be challenging. Switching from direct to regular funds is an option that offers assistance through intermediaries. The process is similar to the one mentioned earlier, but with a slight distinction in selecting the ‘Switch To’ option for a regular plan.

Advantages of Switching: Direct to Regular and Vice Versa

Switching between direct and regular mutual funds has its benefits. Opting for a regular plan grants you professional investment advice and recommendations. Regular plans simplify documentation and KYC requirements, and intermediaries guide you through your investment journey, including portfolio reviews and rebalancing. Assess your financial goals before making any decisions to ensure they align with your chosen plan.

In conclusion

Understanding the dynamics of direct and regular mutual funds is essential for making informed investment choices. Whether you’re looking to switch from a regular to a direct plan or considering the reverse, this guide provides valuable insights for Indian investors. Remember that your investment decisions should align with your financial goals and risk tolerance. If in doubt, consult a financial advisor to ensure you’re on the right track.


What are the tax implications of switching funds?

Switching funds involves selling existing units, which may attract capital gains tax. It’s crucial to consider tax implications before making a switch.

Are exit loads applicable when switching plans?

Yes, exit loads may apply based on the fund’s terms and conditions. Be sure to check these before proceeding.

Can I switch between different fund categories?

Yes, you can switch between different mutual fund categories, but it’s essential to understand the potential impact on your portfolio.

Are there any benefits to staying invested in one type of fund?

Staying invested in one type of fund can lead to consistency and alignment with your investment strategy. However, switching can offer opportunities for optimization.


Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.