Mutual Fund Glossary for IFAs
Clear definitions of key mutual fund, regulatory, and technology terms — for Individual Financial Advisors and distributors across India.
27 terms across 3categories. Use your browser's Ctrl+F / ⌘+F to search this page.
Trail Commission
Ongoing commission paid to MF distributors as a % of AUM held.
ARN Number
AMFI Registration Number — unique ID for every registered MF distributor in India.
AMFI
Association of Mutual Funds in India — the industry body that regulates MF distributors.
NAV
Net Asset Value — the per-unit price of a mutual fund scheme on a given day.
SIP
Systematic Investment Plan — a method of investing a fixed amount in a MF scheme at regular intervals.
XIRR
Extended Internal Rate of Return — the true annualised return on investments with irregular cash flows.
Folio Number
A unique identifier assigned to an investor's account with an AMC.
AUM
Assets Under Management — the total market value of assets managed by a fund or advisor.
Direct vs Regular Plan
Direct plans have no distributor commission; regular plans route through ARN holders who earn trail.
Expense Ratio
Annual fee charged by a mutual fund scheme, expressed as a percentage of AUM.
Exit Load
A fee charged when redeeming mutual fund units before a specified holding period.
SWP
Systematic Withdrawal Plan — regular withdrawal of a fixed amount from a MF investment.
STP
Systematic Transfer Plan — periodic transfer of units from one scheme to another within the same AMC.
Lump Sum Investment
A one-time investment of a large amount into a mutual fund scheme, as opposed to SIP.
CAGR
Compound Annual Growth Rate — annualised return assuming growth at a steady rate over a period.
SEBI
Securities and Exchange Board of India — the regulatory authority for capital markets and MF industry.
KYC
Know Your Customer — mandatory verification of investor identity before any mutual fund investment.
NISM
National Institute of Securities Markets — certifies financial advisors and distributors in India.
EUIN
Employee Unique Identification Number — assigned to employees of an ARN holder who interact with investors.
CKYC
Central KYC — a centralised KYC registry that allows investors to use a single KYC across financial products.
CAMS
Computer Age Management Services — one of India's two main RTAs processing MF transactions.
KFintech
Formerly Karvy — the second major RTA in India handling MF transaction processing and statements.
RTA
Registrar and Transfer Agent — processes MF transactions, maintains folio records, and disburses commissions.
BSE Star MF
BSE's mutual fund transaction platform used by distributors to place orders across all AMCs.
NSE NMF
NSE's National Mutual Fund platform for placing MF transactions across schemes.
Robo Advisory
Automated investment advisory using algorithms to recommend portfolios based on investor risk profile.
AMC
Asset Management Company — the entity that manages a mutual fund scheme and pays trail to distributors.
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