What Is Exit Load?

How Exit load is calculated?

Exit load is typically charged as a small per cent of the Net Asset Value prevailing at the time when you sell your schemes.

How is it calculated.

You will get Rs 99 per unit [Rs 100 – Rs 1 (1 per cent of 100)] on redemption.

The total amount which you will get will be Rs 49,500 (Rs 99 X 500 units)..

What is exit load in SIP?

Exit load is a cost that an investor needs to bear if he or she sells the mutual fund units before a predefined time frame. Typically, equity mutual fund schemes levy an exit load of 1% if the units are sold within one year of buying. Simply put, it is a mechanism to deter investors from premature withdrawals.

Is there any exit load in debt fund?

While debt mutual funds have no lock-in periods, some of the funds carry an exit load which is a charge deducted at source for early withdrawals. The exit load period varies from fund to fund while some funds have nil exit load as well.

Are debt funds risk free?

Things to keep in mind when investing in a debt fund now You should keep a tab on risks like credit risk, liquidity risk, interest rate risk, and duration risk when investing in a debt fund. … One thing is now clear to most investors — debt funds are not risk-free.

Is there a penalty for closing a mutual fund?

Under the federal tax code, you make an early withdrawal if you sell your shares and access funds before age 59 1/2. In these instances, you typically pay a 10 percent penalty. The penalty rises to 25 percent if you cash in shares in a SIMPLE IRA plan that you have held for less than two years.

How is mutual fund exit load calculated?

Exit load in mutual funds is generally a percentage of the Net Asset Value (NAV) of the mutual fund an investor possesses. The Net Asset value is the net value of an entity and is calculated as the entity’s assets minus the value of its liabilities.

When can you exit a mutual fund?

Exit Plan: A few years before your financial goal is actually earmarked for, you should start a transfer plan to relatively safer investments and protect the gains you have had this far. Given the relevant frequent market swings, you could factor in an extra year or two to reach their financial goals where possible.

How is Axis Blue Chip Fund?

The Axis Bluechip Fund Direct Plan Growth is rated Moderately High risk. Minimum SIP Investment is set to 500. Minimum Lumpsum Investment is 5000. For units in excess of 10% of the investment,1% will be charged for redemption within 12 months.

What are the hidden fees in mutual funds?

Funds with high turnover rates incur a host of “hidden” costs that are less transparent to investors. The two primary hidden costs are transaction fees and tax inefficiencies. Combined, they are the worst offenders in running up fund expenses.

Is exit load applicable for switch?

Switches or redemption could attract exit load depending on the type of the fund and its exit clause. For instance, if the fund mandates exit load up to a year, it can apply in case you switch before the stipulated time period. While you make the switch, also keep in mind the taxation aspect of your investment.

Can I stop sip anytime?

Can you stop your SIP? Yes, that is simple. Just fill in an SIP stoppage form or write a letter and you can stop your SIPs. On the other hand, if your bank account doesn’t have enough funds and your SIP is still on, then the fund house may just stop after 3-5 months’ default.

Which mutual fund has no exit load?

4. Aditya Birla Sun Life Short Term FundRating by Groww5 starPerformance w.r.t its BenchmarkHas consistently outperformed its benchmark Crisil Short-Term Bond since its launch.Age of the fund5 years oldExpense Ratio0.26%Exit LoadNIL4 more rows•Dec 18, 2019

How do you exit a mutual fund?

Investors can choose different modes to exit their investment in mutual funds. This can be in the form of actual redemption to switch out or systematic withdrawal plan. Simple redemption can be carried out by filling up a redemption form mentioning the amount to be redeemed from the said mutual fund scheme.

What is entry and exit load?

Exit load is a fee or an amount charged from an investor for exiting or leaving a scheme or the company as an investor. Generally, an entry load is collected to cover costs of distribution by the company. Different mutual funds houses charge different fees as an entry load.

Which is the best debt fund?

Top 10 Debt Mutual FundsFund NameCategoryRatingIDBI Liquid FundDebt5starAxis Banking & PSU Debt FundDebt5starKotak Corporate Bond FundDebt5starEdelweiss Liquid FundDebt5star12 more rows

Can I withdraw mutual fund anytime?

There is nothing to prevent you from withdrawing your mutual fund holdings as long as it is an open-ended fund. Both equity funds and debt funds can be technically withdrawn as soon as the fund is available for daily sale and repurchase.

Can I withdraw my sip before maturity?

There is no penalty for withdrawing from a fund in which one is investing through SIP mode, as SIP and withdrawal (redemption) are two separate mandates. However, exit load may be charged for redeeming before a stipulated period. In case of investment through SIP, every instalment is treated as fresh purchase.

Is Liquid Fund better than FD?

Liquid fund investors are considered to be in a better position than fixed deposit holders in case of taxation on their respective investments. When it comes to tax on liquid funds, the investors are entitled to avail tax indexation, which directly helps them to lower their burden of tax-related expenses.

What is the Blue Chip Fund?

A Blue chip fund is a term used to indicate well-established and financially sound companies. Blue chip funds invest in stocks of those companies that have a credible track record with sound financials along with regular dividend payments and profitability over the years.

What is exit load free balance?

An exit load refers to the fee that the Asset Management Companies (AMCs) charge investors at the time of exiting or redeeming their fund units. … Hence, an exit load discourages investors from prematurely exiting the fund. This fee may also reduce the number of withdrawals from the mutual fund schemes.

How is NAV calculated?

What is NAV? The Net Asset Value represents the market value per share for a particular mutual fund. It is calculated by deducting the liabilities from total asset value divided by the number of shares.