The Securities and Exchange Board of India (Sebi) permitted buying and selling of mutual fund units from the stock exchange platform on November 13, 2009.
“The stock exchange mechanism would also extend the present convenience available to secondary market investors to mutual fund investors,” Sebi had stated in its circular allowing mutual fund transactions on the stock exchange infrastructure.
Now mutual fund investors will get additional access to stock trading and tips from their own mutual fund agent turned stock broker.
So top brokers will build a distribution channel where they will get financial planners, advisors and even insurance agents selling Mutual Funds and Stocks on their terminals.
All this looks very investor friendly as one single advisor can sell insurance, mutual funds and stocks.
The majority of the agents will not have the knowledge and ability to give you sound advice on all asset classes.
Moreover, I have a feeling that the investors may lose as the agent will now have a trading mechanism and Portfolio churning will happen rampantly.
What’s your view?
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