The differentiators between Mutual Funds and Investment Advisory are:
| Features | Investment Advisory | Mutual Fund |
| PM Access | Direct access to IA who share updates on portfolio strategy and emerging trends | No access to Portfolio Managers(PM) |
| Customization | Portfolio can be structured to address each investor’s specific needs/risk appetite | Portfolio structured to meet the fund`s stated investment objectives applicable for all investors |
| Ownership | Unit holders own units of the fund and cannot influence buy and sell decisions or control their exposure to incurring tax liabilities | Investors directly own individual securities in their portfolio, allowing for tax management flexibility |
| Liquidity | Although advisors may advise to hold cash, they are not required to hold cash to meet redemptions. Flexibility in investing corpus | Mutual funds generally hold some cash to meet redemptions |
| Flexibility | Investment Advisory has greater flexibility in comparison to mutual funds. For e.g. the IA may move to 100% cash if required. Investments are advised once an appropriate opportunity arises in the market. The advisor can also advice a portfolio with disproportionate allocation to select compelling opportunities | Mutual funds are comparatively less flexible. Have the mandate to stay invested up to 65% in equities across most of the time period as stated in the investment objective for the scheme. Also, known to be inactive in cash management strategy |
| Number of Stocks | It generally has a focused portfolio of 15-20 stocks, enabling IAs to carry out meaningful allocation of stocks/sector where he/she is most bullish about | Most mutual fund schemes have anywhere between 50-60 stocks |