Can You Transfer Mutual Funds Through ACATS?
Mutual funds sit in a slightly different category than stocks or ETFs when it comes to moving between brokerages, since not every fund can be held everywhere the way a widely traded stock can.
The short answer
Yes, many mutual funds can transfer in-kind through ACATS, meaning the fund shares move directly to the new brokerage rather than being sold and repurchased. Whether a specific fund can make that move depends mainly on whether the receiving brokerage offers that particular fund on its platform at all.
Why fund availability is the deciding factor
Unlike a stock, which trades on a public exchange and can generally be held by any brokerage, a mutual fund is only available through certain distribution channels. If the receiving brokerage doesn’t have an agreement to offer a particular fund, it typically can’t accept that fund in-kind, even if the transfer request otherwise matches perfectly. This is different from holdings that can’t move through ACATS at all; a transferable mutual fund can often still move, just not to every possible destination.
Proprietary funds are the common exception
The clearest example is a fund created and managed by the same firm that holds the account, often called a proprietary fund. Because these funds are typically sold exclusively through their originating brokerage, an outside firm usually has no way to hold them, which means they generally can’t transfer in-kind to a different brokerage. In that situation, the fund often has to be liquidated at the old firm, with the resulting cash transferring instead, or the position stays behind if the account holder chooses to keep it where it is.
What happens when a fund isn’t supported
When a mutual fund can’t move in-kind to the new brokerage, the account holder is typically left with a few options: liquidate the fund and transfer the cash, which may trigger a taxable gain in a taxable account; leave that specific holding at the original firm while the rest of the account transfers; or, in some cases, exchange the fund for a similar one that is supported before initiating the transfer. Which option makes sense generally depends on the account type and whether an equivalent fund is available elsewhere.
This is a separate question from whether a fund is broadly popular or widely held. A large, well-known fund can still be unsupported at a specific brokerage simply because that firm never established the distribution agreement needed to offer it, while a smaller fund might transfer without issue if the right agreement exists. Availability is really a function of relationships between firms rather than anything about the fund’s size or performance.
Checking before initiating a transfer
Because fund availability varies so much firm to firm, it’s generally worth checking with the new brokerage in advance whether each mutual fund in the account is supported for an in-kind transfer, rather than finding out only after the request is already submitted. Many brokerages can confirm this ahead of time, which avoids the surprise of a fund getting flagged mid-transfer.
The takeaway
Mutual funds can absolutely move through ACATS, but only when the receiving brokerage actually offers that fund. Confirming fund-by-fund availability ahead of time is the most reliable way to avoid a transfer that arrives with unexpected gaps.