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Ramalingam Kalirajan |9213 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Jun 17, 2025

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more

Question by Deep on Jun 17, 2025

Sir, I invest through zerodha coin which. offers only direct plans, I checked for regular plans where its showing expense ratio 0.21% for the same fund, whereas in Geojit 0.15% Trail commission is written in each year. Its difficult for me to undestand the impact on my return. Can you please help me understand If I choose regular plans via other platforms instead of Zerodha coin, will they recommend me to exit if gold prices fall sharply or during uncertain Global changes? Im planning it for long so How can I proceed with direct plan in coin & reviewing it externally or getting financial guidance for redemption & tax implication etc?

Ans: Many investors get confused between direct plans vs. regular plans, especially when they see small differences in expense ratio.

Let us now answer only your follow-up question, and show you clearly why investing through an MFD with CFP credentials in regular plans is more useful for long-term gold investment — especially when market timing and redemptions matter.

Expense Ratio Confusion – Clarified
Zerodha Coin offers only direct plans.

You saw 0.15% trail commission on Geojit or other platforms.

Regular plan shows 0.21% expense ratio.

Difference seems small — just 0.06% per year.

But actual difference in benefit is not just about cost. It is about the value of ongoing review, risk management, and tax efficiency.

Let us understand why.

What You Miss in Direct Plans
When you choose direct plans through Coin:

No one alerts you when gold prices peak suddenly.

No expert tells you when to switch partially to equity if your gold allocation exceeds 10%.

You have no help when global uncertainty or dollar fluctuations impact gold.

You also miss proper planning for tax-efficient redemptions.

You may miss rebalancing if gold outperforms other asset classes.

These mistakes can cost you 2–3% or more in returns.

A good Certified Financial Planner will not only help in fund selection but also:

Review your asset allocation yearly.

Help you redeem in parts when gold price rises sharply.

Alert you on macro changes — like inflation, currency impact, or gold policy shifts.

Avoid panic during fall — and even help you buy more when required.

Reduce tax hit by phased redemption.

Ensure your gold holding does not exceed ideal allocation in the portfolio.

But Is 0.06% Difference Really Worth It?
Yes, because with regular plan:

You’re not alone in decision making.

You don’t invest emotionally.

You don’t make panic exits.

You avoid tax shocks by proper planning.

In long-term gold investment, getting exit timing wrong or ignoring asset rebalancing can hurt much more than 0.06% annually.

What You Get with Regular Plan via MFD-CFP
Yearly review of gold’s place in your full portfolio.

Guidance during gold price shocks (up or down).

Support during currency or inflation shifts.

Exit timing and tax planning.

Portfolio alignment with long-term goals.

Also, if your portfolio includes other equity or debt funds, a CFP will see overlaps and make adjustments.

That’s why even small trail commission adds big value — by reducing bigger risks.

Direct Plan with Zerodha Coin – What to Do if You Still Continue
If you still want to go with Coin and direct plans:

You must hire a Certified Financial Planner separately.

They will charge flat fee for yearly guidance.

You’ll still have to review gold performance and tax events on your own platform.

You may need to maintain Excel sheets, monitor gold pricing, macro signals, tax slabs, etc.

If you are financially knowledgeable and very disciplined, you may try this.
But it will require time, effort, and no emotional bias.

Finally
Don’t go by just lowest expense ratio.

Go by who protects your money when you are emotionally weak or unaware.

In that way, regular plans through MFDs with CFP give much more advantage.

You get:

Human guidance

Asset review

Tax smart exits

Behaviour coaching

Risk alerts

All these protect your long-term gains far better than cost savings in direct plans.

Use regular plan. Review yearly with Certified Financial Planner.

This is the most peaceful, profitable path for gold fund investors like you.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.