It refers to moving from a mutual fund’s standard plan (where commissions are paid) to a mutual fund’s direct plan (where no commissions are paid) (where there are no commissions).
In the case of a transfer, your old units are sold and newer units in the direct plan are purchased.
Taxes and, in some cases, exit load are part of the switch-to-direct method.
Switching leads to higher returns in the long run since the fees charged as commision are reinvested.
Switching will not make sense if you are not planning to invest for a long time.
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