Could you please explain how Coin provides an advantage for medium term investors like around 6 Years? with a SIP of 5000 per month.
If i invest 5000 per month via SIP in ELSS Mutual funds through zerodha coin for 6 years. I would be charged 3350 by zerodha coin( According to exemption of first 25000 investment = 5 months(5000/SIP) and rest 67months*50rupees). Generally there is a difference of 1% in regular and Direct funds, few funds like AXIS ELSS have even lesser difference in regular vs direct. Also, please let me know if there are any additional charges when sip is not paid or etc
Request you to please explain much deeper in the above query and amount of difference which would be observed at the end of 6 years.
Thank you in advance.
In a regular plan,
End of 6 years you would have paid 3.6 lks at 5k SIP. Upfront you would have paid Rs 3600 as commissions.
There is also upto 1% in trail commission every year that you would end up paying extra. Assume your money doesn’t grow, this itself would be Rs 600 1st year (1% of Rs 60k), Rs 1200 2nd year (1% of 1.2lks), Rs 1800, Rs 2400, Rs 3000, Rs 3600 = around Rs 12600. This will typically be more because expense ratio is charged daily, so charges are also kind of compounded.
If your money is growing at say 15%, this above trail commission suddenly would increase by quite a bit.
Use a SIP calculator, check the difference in return investing at 15% return vs 14% return, this will broadly be the difference between investing in direct vs regular. At 6 years, 5k/month, 15% direct/14% regular, corpus in direct would be 5.9lks and in regular 5.65lks. So around Rs 25000 more. If the investment period increases, this difference goes up significantly.
What is even more alarming is the fact that the expense ratio gap between Direct and Regular funds is widening beyond 100 bps. Debt funds (esp accrual based corporate bond funds) have started charging expense ratios of 200 bps nowadays. Somehow suspect MFs are trying to cash in on the flood of SIP money pouring in by raising their expense ratios without any significant improvement in performance
Also, please let me know if there are any additional charges when sip is not paid and does rupees 50 per month charged on every sip or overall monthly 50INR.
No additional charge and Rs 50 overall irrespective of value/transactions.
Believe this 50 will be excluding the service tax everymonth.
Is there any charges for withdrawal of investments and also please let me know if you also charge for depositing money in trading account. I tried to speak to my zerodha support but didn’t receive satisfactory answer. Either its yes or no
No charges for withdrawal of money. For depositing, if you use payment gateway then Rs 9 charged by our PG. If you use NEFT/RTGS/IMPS, no charges. Check this: https://zerodha.com/fund-transfer