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How To Invest In Mutual Funds Through Trading App And Why?

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Introduction

Mutual funds provide an excellent avenue for investors to achieve diversified portfolios, additional liquidity, tax benefits and much more—the following brief aims to provide an overview of how one can invest in mutual funds using trading apps. 

Mutual Fund

A mutual fund pools money from various investors to purchase shares, bonds, securities and other assets. Mutual funds are essentially more beneficial for designing diverse portfolios than what an investor could own. These provide an excellent avenue for investors involved in stock or option trading and seeking to benefit from another well-diversified portfolio. You can seek to increase the value of your investment in a mutual fund through the following ways:

  1. Dividend Payments – As a fund receives dividend payments, these are passed on to investors proportionately to their investment. 
  2. Net Asset Value – The Net Asset Value (NAV) can be defined as the price per mutual fund share. NAV increases with the increase in the value of the fund. 
  3. Capital Gains – Suppose the value of constituent security has increased in price, and the mutual fund decides to sell it. In the process, the fund incurs a capital gain. Most mutual funds distribute capital gains annually. 

Trading Apps for Mutual Funds

Technological advancements have made it easier to invest in mutual funds. Numerous apps facilitate an easy trading platform in equities, derivatives such as futures or options trading, mutual funds, and other asset classes. Bajaj Securities App uses an advanced technological interface that helps users invest in mutual funds in a simple and hassle-free manner. Moreover, the Bajaj Securities app provides extensive features for mutual funds, such as:

Investing in mutual funds through trading apps

Trading apps help investors invest in mutual funds hassle-free. Users can choose to invest in stocks, seek to profit from options trading or invest in other derivative contracts or asset classes simply through a couple of clicks. Let us understand the procedure involved by which users can invest in mutual funds through trading apps.

Step 1:  Select your preferred app: download and signup.

Step 2:  Choose your preferred scheme from the list of available plans being offered. You must conduct thorough research before you select a specific fund. You may want to thoroughly conduct a detailed analysis of the specific portfolio before making an investment.

Step 3: Select your mode of investment. You may select a one-time investment or a SIP. Most apps offer SIP features wherein investors can invest some amount into the fund regularly, such as monthly, bi-monthly, fortnightly or quarterly. 

Step 4: Enter the investment amount or the SIP date. 

A significant advantage of trading apps is that they do not require any additional documents for investing in mutual funds through trading apps. Once the Know-Your-Customer (KYC) is done, investors can begin using the apps. 

Additionally, you must consider the following factors before investing.

Advantages of using trading apps 

Here is an overview of the key benefits of using trading apps to invest in mutual funds. 

Conclusion

Trading apps offer numerous features for trading in mutual funds in a simple and hassle-free manner. These apps have made it convenient for investors to choose from different investment schemes and buy/sell their holdings anywhere and anytime. 

Read also: A Beginner’s Guide for Trading & Option Trading?

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