There has been a lot of debate on AMFI's proposal to cap upfront commissions for distributors. The debate on twitter has been particularly incisive and one can get a general sense of how the debate went outside AMFI. A few links on the topic and some really great comments are given below in the storyfied collection. Read on for quotes from Mutual Fund CEOs distributors, planners and others...
It seems MFs are more concerned about ' POOR ADVISORS 'rather than bread & butter investors.They never advertise about advantages of direct invest mode.In fact,they discourage it.Why?Why do they prefer DALALs & charge investors to pay them ? Why websites ,also,publish their views only?Because websites are getting advertisements from them!And poor investor!He pays to all of them.It is his money everybody is playing with.And he is a mere spectator.No one is asking the payee!
ReplyDelete-A poor investor
Dear Poor Investor , actually , the poor advisor( especailly the IFA'a) , is the only one who is worried about you , and really can help you. Surprisingly , even this direct plan is funded by the humongous efforts put in by IFA's. With out a sales man or a sales executive , no product can be reached to the investor. That said , the MF had adopted a cost effective way of employing low cost advisors! Now that they have grown , to a little size , they want to kill the roots on which they have grown - kill the IFA's, by ensuring that they are not rewarded properly .In the whole process actually , the AMCs are churning the advisors! Almost 1 lakh croes of AUM is in lapsed ARN codes. No adviosr is paid for this AUM , but the AMCs are charging full fees.In fact the real guy who is in contact with investor and works for the investor is the ditsributor , the IFA.If an IFA is assuerd of a regular and reasonable reward , more investors can be served , and the benefits of mutual funds can reach many more investors. But the things are being tried in a different way. Thats why this debate on stopping upfront commissions and pay commissions to advisors as a trail only model, so that no mis selling happens , and aslo , continued support from the advisor to the investor is ensured.
ReplyDeleteContents of this website are good and appreciative.
ReplyDeleteReal estate cash flow commission & Factoring real estate commissions