Ch.6 · ARN and EUIN Rules · medium
What is the significance of the AUM-based trail commission model for a distributor's business?
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EXPLANATION
AUM-based trail creates a recurring, compounding income stream for distributors. As the investor's portfolio grows (through market appreciation and additional SIPs), the absolute trail income also grows. A distributor with ₹100 crore AUM earning 0.5% trail earns ₹50 lakh annually — this makes distribution a sustainable long-term business.
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