Be aware of your rights as an investor: Study all offer documents carefully

To have a smooth financial journey as an investor , you have to fulfill certain duties and, under the laws that regulate the mutual fund industry, you also enjoy some rights.

An ideal investor is one who is aware of the rights, and disciplined and serious about his/her duties too.

Some of the important rights that you enjoy as an MF investor include the freedom to go through the offer document of the scheme that you intend to invest in, email/SMS alerts relating to your investments, receiving annual reports, periodic updates and other important communications from the fund house including any proposed change in a scheme's attributes.

You also enjoy the right to know how much commission the person who is advising you to invest is getting from the fund house. Also, you can get your complaints, if any, redressed through proper channels and to your complete satisfaction.

What you're entitled to:

Offer document:

An offer to invest in an MF scheme contains the scheme information document (SID) and a statement of additional information (SAI). In addition, you can also go through the key information memorandum (KIM), which gives important information about the scheme you intend to invest in as well as the fund house.

Colour coding:

This is a new tool aimed at helping investors choose between MF schemes which are least risky (Blue dot), moderately risky (yellow dot) and highly risky (brown dot). Here, each fund house labels every scheme with the appropriate code to make it easier for you to select the one best suited to your risk profile.

Email/SMS alerts:

Within five working days of your investing in a scheme — either for the first time or as a continuing investor — you should receive an email alert or an SMS about your investments.

Fund statements, periodic updates and annual reports:

As an investor in a scheme, you should receive periodic updates from the fund house about the scheme as well as the fund house, its annual report and updates as and when issued.

Consolidated statements:

Relatively a new initiative, all MF investors now get a consolidated monthly statement of all their fund-related transactions in each scheme where he/she has investments, across all types of schemes (equity, debt, liquid, gold ETF) and across all fund houses. However, if there is no transaction during a particular month(s), you will receive a half-yearly statement.