Folio Number in Mutual Funds: The Key Every Investor Must Know for Tracking, Managing, and Simplifying Investments Like a Pro!
A folio number is a unique identifier provided by AMCs for tracking mutual fund investments, ensuring easy monitoring, seamless redemption, and efficient portfolio management for investors.
Banks provide an account number to identify their customers, just like we used to get a roll number for attendance during school time. You can see this trend of number identification everywhere like Aadhaar, PAN card, Passport. Similarly, you are assigned an identity number in mutual funds as well.
Maybe you didn't notice, but fund houses provide a number to mutual fund investors, which is called a folio number. And if you also invest in mutual funds, then what is this number and why is it so important? It is very important for you to know this.
In this article we are going to discuss what a folio number is, how you can find out your folio number, and what are the benefits of a folio number. At the end of the articles, we will also discuss whether you can keep multiple folio numbers.
What is Folio Number?
Investors who invest in mutual funds are given a unique identification number called a folio number. Investors can use this number to track their mutual fund investment account. Additionally, the folio number is used to track the transactions of investors, including their buys, sells, dividends, and some other associated activities.
Basically, the folio number helps to make the management of investments seamless and effective. If you own multiple shares of the same mutual fund, the fund house provides you with only one folio number. At the time of application, your folio column is kept empty. When you make your initial contribution, the fund house or AMC generates a folio number for you.
But where can you find this folio number?
How to Find Your Folio Number?
Generally, there are three ways to find out folio information:
- Fund Account Statement: This is issued by the AMC. For SIPs, this statement is issued on a monthly basis. You can take a mutual fund statement directly from the fund house, where your folio number and all other information are mentioned.
- Consolidated Account Statements: These documents show total investments through numerous folio numbers of different AMCs. These are issued by registrars like CAMS Online and KFintech. Holdings can also be tracked using the investor’s PAN number.
- Registrar’s Website or Branch Office: You can visit the Registrar's website or branch office and receive your folio number after proving ownership. Some fund companies also allow you to obtain the folio number via their call center.
Benefits of Folio Number
The first benefit is the Consolidated View, which allows you to access all schemes with a single folio number through one statement. This includes all investment details with the AMC.
Second is Tracking of Investments, as investors can use the folio number to track their mutual fund investments. You can view the statement for a specific period to know how many units you hold in a fund.
The third benefit is Easy Redemption, as you must mention your folio number when redeeming mutual fund units. This makes the redemption process quick and easy.
Can You Keep Multiple Folio Numbers?
New generation DIY investors often face issues with multiple folios in their portfolios because they do not mention their existing folio number while investing in new schemes. This leads to the AMC creating a new folio.
You can talk to the AMC and consolidate them if you have multiple folios in a single scheme.
Investors also have the option to take different folio numbers for different fund schemes within the same AMC. However, most investors prefer a single folio number for better tracking and management.
Having multiple folio numbers is not wrong but can increase complexities like tracking investments, tax planning, and administrative work. For instance, you would need to add nominations and update details separately for each folio.
A single folio number helps keep your portfolio organized.
Summary
AMC gives investors a unique identification number for mutual fund investments, which is called a folio number. As an investor, you should save this number because it helps you monitor the performance of your assets. If you haven’t started your journey of mutual fund investing yet, you can do it after reading this article.
Disclaimer: The article is for informational purposes only and not investment advice.