Direct VS Regular Mutual Fund

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Direct VS Regular Mutual Fund in tabular format

ParameterDirect PlanRegular Plan
Third-PartyNot PresentPresent
Expense RatioLow expense ratio (no additional fees to broker/agent)High expense ratio (includes a commission to distributor/agent)
NAVHigh due to low expense ratio.Low due to high expense ratio.
ReturnsMarginally higher returns due to a low expense ratio.Marginally lower returns due to a high expense ratio.
Market ResearchDone by SelfDone by advisor
Investment AdviceNot AvailableProvided by advisor
InvestmentInvestors directly invest in a plan of a fund houseInvestment is made through third-party intermediaries

Here is a comparison between returns form the direct and regular mutual funds for SBI Bluechip funds. For simplicity, we have taken an initial investment of Rs. 10,00,000 in this illustration.

Initial investment amountRs. 10,00,000Rs. 10,00,000
Investment tenure5 years5 years
Average 5-year return20.34 %19.24 %1.1%
Final return amountRs. 25,23,771Rs. 24,10,515Rs. 1,13,256

Thus in this case Direct has given a better return , than regular mutual fund
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