SEBI RIA vs Mutual Fund Distributor: Who Is Paid to Advise You?

Two people can hand you the same fund and be paid in completely different ways. That difference is the whole story.

The distributor model

A mutual fund distributor is paid by the asset management company. Their income comes out of the fund you are sold, through the regular plan's expense ratio. You never see an invoice, so it feels free. It is not free; it is simply deducted before your returns are reported.

The advisor model

A SEBI-Registered Investment Advisor (RIA) is paid by you, directly, under a written advisory agreement. Invsify is registered with SEBI as an Investment Advisor, registration number INA000020572. Because the fee comes from the client and not the product, the advisor can recommend direct plans, index funds, or nothing at all.

Regular vs direct plans

The same scheme is usually available in two versions. The regular plan carries distribution commission inside its expense ratio. The direct plan does not. Over long holding periods that gap compounds against you, which is why fee-only advice generally points at direct plans.

The question to ask

Ask any person advising you one question: do you still get paid if I buy the direct plan? If the answer is no, you are talking to a distributor. If the answer is yes, because you pay them a fee, you are talking to an advisor.

Can the advice say "do nothing"?

A distributor's income requires a transaction. An advisor's income does not. That is why fee-only advice is allowed to be boring: stay invested, do not switch, do not add a fifth fund that overlaps the other four.

How Invsify is structured

Invsify ONE is a single risk-profiled portfolio at a fee of 1.5% + GST. Invsify Private is a white-glove relationship for more complex financial lives, and is scoped on a call. You can book a call to discuss which is appropriate.

We do not take custody of your money. You hold your own investments; we advise on them.

Invsify is a SEBI-Registered Investment Advisor (Registration No. INA000020572). Investments are subject to market risks. Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.