SIP in these safe mutual funds has always yielded good returns

1. Nippon India Fixed Horizon Fund 40 – Series 3:

From the Fixed Maturity Plan – Debt category. This fund with assets under management of Rs. 122.7 crore and NAV as of May 17th as 11.19 is a closed fund. Investments in FMPs are generally only allowed during the opening period of the NFO.

The fund has over 93.5% of investments in debt, of which 84% is in funds that have invested in very low risk securities.

Such an investment is suitable for investors who have a longer horizon but can take a low risk compared to equity programs.

The benchmark for the program was the Gilt CRISIL 10 Year Index and the fund outperformed the index over the one year period, yielding an absolute return of 18.62%.

Now, if SIP in this fund was launched a year ago with Rs. 1000 invested each month, the total investment of Rs. 12000 will now be worth Rs. 13,221, offering an annualized return of over 19%.

Some of the main securities in which the Nippon India Fixed Horizon Fund 40- Series 3 is invested are GOI, CD, T-Bills, CP, NCD and Bonds.

2. UTI Fixed Term Income Fund-Series XXIX-Plan XIII-G:

2. UTI Fixed Term Income Fund-Series XXIX-Plan XIII-G:

The FMP fund with 94% investment in debt has 16% exposure to government securities while the 68% is parked in low risk securities. Compared to its benchmark, the program outperformed with an annualized return of over 15%. This is the lump sum investment. In addition, the plan outperformed the category average return of 7.4 percent. Since its inception in 2018, the fund has generated an absolute return of over 20%.

3. Nippon India Fixed Horizon Fund 39 - Series 5-G:

3. Nippon India Fixed Horizon Fund 39 – Series 5-G:

This Nippon India FMP was opened in 2018 and since its inception has given an absolute return of over 15%. Compared to its benchmark, the program outperformed by generating more than 18% gains in absolute value. The fund’s 94 percent corpus is leveraged, 82 percent of which is invested in very low risk securities.

4. Nippon India Fixed Horizon Fund 38-Series 2-G:

4. Nippon India Fixed Horizon Fund 38-Series 2-G:

Opened in 2018, this fund has more than 93% of investments in debt, of which 83% in funds invested in very low risk securities. This fund also outperformed both the benchmark and the average class return, with a 1 year return of over 17%.

Taxation of debt UCITS:

Taxation of debt UCITS:

Mutual funds can give you a return in 2 ways:

1. Dividend

2. Capital gains

Tax treatment of debt UCITS
Dividend Income added to taxable income of investors Taxation at the personal income tax slab rate
STCG (holding period less than 36 months) Earnings added to your taxable income
LTCG (detention period of 36 months and more) LTCGs are taxed at 20% after indexation

Source link

About Richard Chandler

Avatar

Check Also

Here’s Why Jiangxi Copper (HKG: 358) Can Responsibly Manage Debt

Berkshire Hathaway’s Charlie Munger-backed external fund manager Li Lu is quick to say “The biggest …

Leave a Reply

Your email address will not be published. Required fields are marked *