Folio number meaning, importance, and uses in mutual funds

Whether it is the digits on the weighing scale, your ratings on a professional app, or the degrees of the weather, numbers have a unique place in most spheres of life. The Aadhaar number is linked to your identity, the pin code is indicative of your residence, and your bank balance is a reflection of your savings. A mutual fund investment also has a unique number attached to it – the folio number. Keep reading to find out what this is and why this is important.

When it comes to investing in mutual funds, we often hear or read about the term "folio number." But what is folio number in mutual fund? In this article, let us consider the different aspects related to the question of what is folio in mutual funds and understand their significance in the mutual fund investment landscape.

In simple terms, the answer to the question what is folio number in mutual fund is as follows – a folio number is a unique identification number assigned to each investor's account within a mutual fund scheme. It acts as a reference number that helps track and manage an investor's holdings, transactions, and other important details associated with their investment portfolio. Folio numbers play a crucial role in streamlining mutual fund investments. They enable investors to monitor their investment performance, track transactions, and receive regular updates on their holdings. Moreover, folio numbers provide convenience when it comes to managing multiple mutual fund investments, as each fund and scheme will have its own unique folio number.

Understanding how folio numbers work is essential for investors looking to navigate the mutual fund landscape effectively. It facilitates seamless communication between investors and asset management companies, ensuring accurate record-keeping and efficient servicing.

Folio number meaning

A folio number is an identification number given by an Asset Management Company (AMC) to identify your investments with them. It is given to each investor when they make the first investment with an AMC. You can have different folio numbers for different funds in the same AMC. Alternatively, you can also have a single folio number for all investments made in the same mutual fund house. For instance, if you have invested in two mutual fund schemes of AMC 1, you can have the same folio number for both. However, if you invest in mutual fund schemes of multiple AMCs, you will have different folio numbers for AMC 1, AMC 2, AMC 3, and so on.

The folio number is essential for both, the AMC as well as the investor. It can help the AMC keep track of all investments made by a particular investor. It also helps you, as an investor, to monitor your investments, keep an eye on mutual funds returns from each AMC, and accordingly plan your investments and redemptions.

How to find your folio number?

You can find the folio number in one of the following ways:

• The Consolidated Account Statement (CAS) sent to you by the AMC contains the folio number. You can check your recent CAS to find it.
• Every time you invest through a Systematic Investment Plan (SIP) or make a lump sum investment in a mutual fund scheme, a confirmation statement is sent to you. This statement contains the folio number.
• You can contact the AMC to get your folio number. Most AMCs have a toll-free number for customers. You can either call or send them an email about the same. You can also visit the nearest branch of an AMC and talk to a representative in person. Additionally, you can log into your investor account on the AMC’s website and find your folio number there.

What is the use or benefit of the folio number?

The biggest advantage of the folio number is that it helps you with investment planning. Since all your investments are aligned to specific folio numbers, you can use them to go through the returns, performance, expenses, units bought or sold, etc., of each. For instance, if you are confused between equity vs debt funds and are thinking of discontinuing your investment in one, you can use the folio number to check the trail of your investments and how they have fared to make a decision.

Conclusion

As you have seen from this article, folio numbers in mutual funds play a pivotal role in simplifying the lives of investors and aiding them in tracking their investments effectively. With a unique folio number assigned to each investor, you can effortlessly monitor the performance of your mutual fund holdings and track your investments. This is especially beneficial to investors with multiple mutual fund schemes under their portfolio as folio numbers enable them to easily access their investment details, including transaction history, portfolio statements, and dividend payouts, by referring to their folio numbers. This streamlined approach saves investors from the hassle of maintaining complex records and facilitates seamless communication with asset management companies. Folio numbers act as a central reference point, allowing investors to stay organised, make informed decisions, and confidently track the progress of their mutual fund investments, without needing to remember the exact name or AMC of the fund you have invested in.

The folio number may seem like any other inconsequential number, but it has simplified investing on multiple levels. So, try to maintain a record of it for all your investments in mutual funds.  

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