The value of advice: a break-even, not a promise
A Direct plan costs a little less. A Regular plan comes with a distributor who helps you choose, review and stay on course. Here is how to weigh the two.
If a Regular plan costs g percentage points a year more than the Direct plan, then in a simple model where both earn the same gross return, support would need to add about g a year to the investor's net outcome to break even. With the median gap of 0.70 pp, that is about ₹7,000 a year on a ₹10 lakh portfolio. This is arithmetic, not a claim that support produces it.
Over 20 years, the illustration above leaves the Regular path 8.7% below the Direct path. A single decision that cost about that share of the portfolio once, such as selling during a fall and buying back higher, would cost as much as the whole expense difference. The simulator compares this with the cost of missing the market's best days, using index-fund data.
- Financial: potentially better investment decisions
- Behavioural: help in avoiding panic selling and performance chasing
- Allocation: keeping the asset mix on plan
- Process: a disciplined, repeatable investment process
- Time: saving the investor's own time
- Service: transactions, documentation, ongoing support
- Tax and records: understanding implications and keeping records
Conceptual categories, not a return figure. MFIC does not claim that distributors or advisers generate a specific additional return.
- What is the difference between a Direct and a Regular plan?
- Both plans of a scheme hold the same portfolio and have the same fund manager. A Regular plan is bought through a distributor and its expense ratio includes the distributor's remuneration; a Direct plan is bought directly from the fund house or through a platform and has a lower expense ratio.
- How much more does a Regular plan cost?
- In AMFI's TER disclosure as of 2 Oct 2026, the median Regular plan costs 0.70 percentage points a year more than the Direct plan of the same scheme, across 1729 schemes (the middle half lie between 0.39 and 1.13 pp).
- Is a Direct plan always better?
- A Direct plan costs less, but the investor takes on research, selection, monitoring, rebalancing, tax records and staying invested through falls. Whether the cost of support is worth it depends on the investor; no form of support guarantees better returns.
- Is a mutual fund distributor the same as an investment adviser?
- No. A Mutual Fund Distributor is registered with AMFI and is paid commission by fund houses from Regular-plan expenses. A SEBI-registered Investment Adviser charges the client a fee and usually recommends Direct plans. Integrato is an AMFI-registered Mutual Fund Distributor (ARN-173155), not a SEBI-registered Investment Adviser.
- How do I see what my distributor is paid?
- Your half-yearly Consolidated Account Statement (CAS) shows, for each scheme, the commission in rupees paid to your distributor for that half-year. You can also ask the distributor directly.
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