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Trail commission: the ₹8,000 vs ₹9,600 trap

A client's ₹10 lakh is now worth ₹12 lakh and trail is 0.8% a year. Trail is paid on the current value, so the answer is ₹9,600, not ₹8,000.

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The full concept: How distributors earn

Worked example: A client's ₹10 lakh grows to ₹12 lakh. At a 0.8% trail, the annual commission rises from ₹8,000 to ₹9,600, because trail is linked to current value. If the client redeems, the trail on that money stops.

Exam trap: Trail is calculated on the current value of assets sold by the distributor, not on the amount originally invested.

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