Fund trading through Exchange

The mutual fund schemes can be purchased or sold through stock exchanges. But this facility is possible only for those who have Demat account in NSDL and at the same time those who have CDSL account this facility is not available. The NSDL account starts with English letters IN and with 6 numbers whereas the CDSL had 16 digits. In this way only 6 Fund House schemes are available for trading purpose.

How to Trade?

NSE had introduced Mutual Fund Service System (MFSS) for the purpose of Mutual Fund Trading. The mutual fund schemes can be traded in all the trading days from 9am to 3pm with the NAV value of the previous day but having no relation with the present day market. Those who had the demat account, has to submit a letter to the brokerage company asking for the permission for fund trading. By this you can purchase the funds as the shares are purchased and sold. After the purchase of a single unit, the unit (T+1) is deposited into your DP account.

Now a day’s many brokerage companies are taking 1.25% of brokerage commission. Coming to the liquid and debt schemes the brokerage commission ranges from 0.5 to 1%.But there is no clear cut idea about the units of trading in the stock exchange. It is the responsibility of the Income tax officers to clear the doubts regarding the securities transaction tax of equity funds.