Question 1

What is a mutual fund?

Accepted Answer

A mutual fund pools money from many investors and invests it in a diversified portfolio of stocks, bonds, or other securities. A fund manager makes day-to-day investment decisions. Your money buys units, and your returns depend on the portfolio's performance. Mutual funds in India are regulated by SEBI, ensuring transparency and investor protection.

Question 2

What are the main types of mutual funds?

Accepted Answer

Mutual funds are broadly classified into three categories:

1. Equity Mutual Funds – Invest primarily in stocks. Suitable for long-term wealth creation but come with higher volatility.

2. Debt Mutual Funds – Invest in fixed-income instruments (government securities, corporate bonds). Generally more stable, suited for conservative investors or shorter horizons.

3. Hybrid Mutual Funds – Invest in a mix of equity and debt, aiming to balance growth and stability.

Question 3

Who can invest in mutual funds in India?

Accepted Answer

Resident Indians, Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs), Hindu Undivided Families (HUFs), and corporates can all invest in mutual funds. All investors must complete KYC before investing.

Question 4

What do I need to start investing?

Accepted Answer

To invest in mutual funds you need: a PAN card, a bank account in your name, and completed KYC. KYC is a one-time process valid across all mutual fund platforms and intermediaries.

Question 5

Can I invest in mutual funds for a minor?

Accepted Answer

Yes. A parent or legal guardian can invest on behalf of a minor. Once the minor turns 18, the account must be converted to a major account after completing the required formalities. Income from minor investments is typically clubbed with the guardian's income for tax purposes.

Question 6

What is a SIP?

Accepted Answer

A Systematic Investment Plan (SIP) lets you invest a fixed amount at regular intervals (monthly, weekly, etc.). It removes the need to time the market, averages your cost over market cycles (rupee-cost averaging), and builds long-term discipline. Even ₹500/month, started early and continued consistently, compounds significantly over a decade.

Question 7

What is NAV?

Accepted Answer

NAV (Net Asset Value) is the per-unit price of a mutual fund scheme. It is calculated daily by dividing the total value of the fund's assets minus liabilities by the total number of units outstanding. When you buy units, you get them at the prevailing NAV; when you redeem, you receive the NAV on redemption date.

Question 8

What is the expense ratio?

Accepted Answer

The expense ratio is the annual fee charged by a mutual fund to cover its operating costs (management fees, administrative costs, etc.). It is expressed as a percentage of the fund's average assets and is deducted from the fund's NAV daily. A lower expense ratio means more of the fund's returns flow to you.

Question 9

What is Keep Investing?

Accepted Answer

Keep Investing is an AMFI Registered Mutual Fund Distributor (ARN: 119185). We facilitate mutual fund investments, provide investor education content, and help investors stay disciplined through market cycles. We are not a SEBI Registered Investment Adviser and do not provide personalised investment advice.

Question 10

How do I get started?

Accepted Answer

The process is straightforward: (1) Reach out via our contact form or WhatsApp. (2) Complete your KYC — we guide you through this. (3) Register with us via our online registration form. (4) Start your SIP or lump sum investment through our platform. The entire onboarding process typically takes 1–2 working days.

Question 11

Can I track my investments online?

Accepted Answer

Yes. Once onboarded, you receive access credentials to view your portfolio, transactions, and performance online at any time.

Question 12

How is Keep Investing different from other platforms?

Accepted Answer

Most platforms focus purely on execution. We focus on investor behaviour and education alongside execution. We publish market data tools, SIP calculators, valuation dashboards, and educational content — all freely accessible — to help investors make informed decisions and stay the course during market volatility.

Question 13

Do you charge investors any fees?

Accepted Answer

No. We do not charge investors directly. As an AMFI Registered Distributor, we receive distribution commission from Asset Management Companies (AMCs). This commission is already factored into the fund's expense ratio and does not result in any additional charge to investors. This is disclosed as per AMFI guidelines.

Question 14

What is the difference between Regular and Direct plans?

Accepted Answer

Direct plans have a lower expense ratio because there is no distributor commission — you invest directly with the AMC. Regular plans include distributor commission in the expense ratio. The trade-off is that with a regular plan through a distributor, you get access to onboarding support, transaction assistance, and educational guidance. With direct plans, you manage everything independently.

Question 15

How are equity mutual funds taxed?

Accepted Answer

Short-Term Capital Gains (STCG) — if sold within 12 months — are taxed at 20%.

Long-Term Capital Gains (LTCG) — held for more than 12 months — gains up to ₹1.25 lakh per year are exempt. Gains above ₹1.25 lakh are taxed at 12.5% (without indexation).

These rates apply to equity-oriented funds where Securities Transaction Tax (STT) is paid.

Question 16

How are debt mutual funds taxed?

Accepted Answer

For investments made after 1 April 2023: All capital gains are taxed as per your applicable income tax slab rate, regardless of holding period.

For investments made before 1 April 2023: Long-term gains (held for more than 3 years) were eligible for 20% tax with indexation benefits.

Question 17

Is there TDS on mutual fund redemptions?

Accepted Answer

For Resident Indians: No TDS applies on mutual fund redemptions.

For NRIs: TDS is deducted as per applicable tax treaty rates. NRIs can claim refunds by filing an income tax return in India.

Question 18

What is LTCG harvesting?

Accepted Answer

LTCG harvesting (also called tax-loss harvesting or grandfathering) is the practice of redeeming equity mutual fund units each year up to the ₹1.25 lakh LTCG exemption limit and immediately reinvesting — effectively resetting your cost basis and using the annual exemption. This is a legal tax optimisation strategy.

Question 19

Is timing the market important?

Accepted Answer

No. Successful long-term investing is less about timing the market and more about time in the market. Even professional investors consistently fail to time markets accurately. A disciplined SIP across market cycles outperforms most market-timing strategies over a 10-year horizon.

Question 20

What should I do when markets fall sharply?

Accepted Answer

Continue your SIPs. Market downturns are a normal part of investing cycles. When markets fall, your SIP buys more units at lower prices — this is rupee-cost averaging at work. Investors who paused or stopped SIPs during the 2020 COVID crash missed one of the fastest recoveries in market history.

Question 21

How much should I invest?

Accepted Answer

A general guideline is to invest 20–30% of your income in financial assets. Increase this rate gradually as your income grows. The exact amount matters less than consistency — investing even a smaller amount regularly over years is far better than sporadic large investments.

Question 22

How do I choose the right fund?

Accepted Answer

Choosing the right fund depends on three factors:

1. Time Horizon: Less than 3 years → Debt funds. 3–5 years → Hybrid funds. More than 5 years → Equity funds.

2. Risk Appetite: Your comfort with NAV fluctuations determines appropriate equity exposure.

3. Goals: Different goals (retirement, education, house) require different strategies and time horizons.

Note: We provide educational guidance on fund categories. We do not provide personalised fund recommendations — that is the domain of SEBI Registered Investment Advisers.

Frequently Asked Questions

Mutual Fund Basics

Investing With Us

Taxation

Investment Philosophy