The gains from mutual funds are taxed as Capital Gain Tax. The tax rates vary basis the holding period of the investor (Short Term or Long Term). Gains from sale of mutual fund units held over 1 year are considered as Long Term Capital Gains. The gains exceeding ₹ 1.25 lakh in a financial year
Equity Linked Savings Scheme (ELSS) funds qualify for tax deductions up to ₹1.5 lakh under Section 80C of Income Tax Act. ELSS are equity-oriented mutual funds with a 3-year lock-in period. This benefit is applicable if you choose the old tax regime only.
The Total Expense Ratio is the annual fee charged by the mutual fund scheme for managing your money. The TER covers the expenses for managing a mutual fund scheme – such as sales & marketing / advertising expenses, administrative expenses, transaction costs, investment management fees, registrar fees, custodian fees, audit fees calculated as a percentage
NAV (Net Asset Value) is the per-unit price of a mutual fund. It’s calculated as:NAV = (Total Market Value of Assets – Liabilities) ÷ Total Number of Units Outstanding.Assets include the market value of all investments held by the fund, while liabilities are expenses and management fees. NAV is calculated at the end of each
Yes, you can take a loan against mutual fund units. Many banks and NBFCs offer loans against mutual fund holdings, typically up to 50-80% of the fund’s market value. This is a secured loan where your mutual fund units are pledged as collateral. The interest rate varies based on the lender and the type of
Yes, you can withdraw your money from mutual funds, but it depends on the type of fund. Open-ended mutual funds allow withdrawals at any time, while close-ended funds have a fixed maturity period. Most open-ended mutual funds allow withdrawals (also known as redemptions) at any time. For equity mutual funds, it generally takes 1-3 business
Mutual funds are considered safer than individual stocks, as they provide diversification by pooling money from several investors and investing in a range of securities. They invest in anywhere between 20 to 90 stocks or more. This diversification helps reduce the risk associated with investing in single stocks. However, the safety of a mutual fund
ETFs (Exchange Traded Funds) and mutual funds both help in long-term wealth creation, but they serve different investor needs. ETFs are passively managed, often tracking an index, and usually come with lower expense ratios. However, they require a Demat account and are bought/sold like stocks.Mutual funds are professionally managed and more suitable for hands-off investors,
Flexicap funds offer diversification with flexibility. Unlike large-cap, mid-cap, or small-cap funds that stick to one market segment, flexicap funds allow the fund manager to invest across all three. This helps reduce risk during market volatility and improves the chances of capturing gains from different segments.They are ideal for investors seeking a blend of stability,
Multicap funds invest across large, mid, and small-cap stocks, but they must follow a minimum fixed allocation across these segments, as per SEBI rules. Flexicap funds also invest across all market caps—large, mid, and small—based on market conditions and opportunities. Unlike Multicap funds, flexicaps aren’t restricted by allocation limits. This gives fund managers the flexibility
