Hi,
I recently became a mutual fund distributor along with Sebi registered Investment Advisor (RIA). How can I automate buying/selling mutual funds on behalf of my prospective clients ? Is mandate based auto execution possible via mfu or smallcase ?
@nithin
Hey @samsingh, as far as I know, mandate-based auto execution for mutual funds isn’t fully supported yet due to regulatory constraints. Platforms like MFU might help with easier transactions through CAN registration, but full automation (like direct execution without client intervention) is limited. Smallcase is more for stocks/ETFs, not regular MF. Interested to see what @nithin says too.
RIA is not allowed to buy/sell on behalf of clients, consent from user is required for each trade.
Smallcase flow you can use for MF now, everything is online, via mandates user can buy automatically but for sell or any rebalance user consent is required, even any new one time buy user consent is required.
Smallcase send push notifications, user just need to accept it.
I have created my own algo which is good with nifty levels and NAV’s of mutual funds. How can I do trading in mutual funds for retail investors ? I am aware of expense ratio, exit load etc. My strategy is net positive considering the costs. Would like to have views of @nithin as well.
It is not about his view or my view, rule says RIA can’t trade on behalf of clients, their consent is needed before every trade.
Okay, can normal mutual fund distributors trade on behalf of clients ? What’s the best route to create a product around this algo ?
Nope.
No way as of now, best would be to check smallcase flow as and when alert is triggered they do push notification, client has to give consent, no other alternative.
Thanks @siva for your replies. One last question- If I send an alert to all clients with when to buy, when to exit a mutual fund through my app; that is allowed right ? How do I charge in that case ? Commissions from amc’s or consulting/aua fees as per RIA ?