Does Zerodha charge for Mutual Funds?

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No, Zerodha doesn't charge a fee for investing in Mutual Funds (MF). Zerodha mutual fund charges are nil. On top, Zerodha offers 'Direct Mutual Funds' which results in an additional saving of over 2% yearly to the investors.

Zerodha is the first broker to offer direct mutual funds. In case of Direct Mutual Funds, the broker like Zerodha doesn't get any upfront of trail commission from the Mutual Fund managers or AMC. The savings from this is passed on to the customer in terms of higher returns.

Zerodha offers it's online Mutual Funds investment services to a platform name Coin. Zerodha Coin has a website and a mobile app, available for free to charge to all Zerodha customers.

Mutual fund investment with Zerodha is absolutely free. There is no brokerage, no software charges, no upfront or trail commission from fund managers or AMCs and no hidden charges. Also, there is no limit on size or number of transactions.

 

How Zerodha make money by offering free Mutual Funds?

Many people ask about how Zerodha makes money by offering Free Mutual Fund. Majority of Zerodha revenue comes from derivatives trading. By offering free services like MF's, Zerodha attract many large traders and investors who eventually pay by using it's stock and derivates trading services.

Zerodha earn small interest from the money you keep in your trading account for few days before you buy stock or mutual funds. Zerodha keeps your money into bank FD's and earns interest in it.

For example, if you keep Rs 1 lakhs in your trading account for 1 day, Zerodha earn Rs 19.18 interest on it (at the rate of 7% annual interest).

 

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