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Wealth Management

Diversified, long-term portfolio strategies across equity, debt and other assets, built around your goals, horizon and risk profile.

• Mutual Funds →
• Small Savings →
• Fixed Deposits →
• RBI Bonds →

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Mutual Funds

What is a mutual fund?

Mutual funds are financial instruments which invest in a portfolio of securities. These securities may be stocks, bonds, money market instruments, gold, silver and real estate investment trusts (REITs), among others. You buy units of a mutual fund; each unit represents a certain percentage of the scheme's portfolio. Mutual funds are managed by professional fund managers according to each scheme's investment objective.

How to invest in mutual funds?

When an asset management company (AMC) launches a new scheme, it invites subscriptions from the public in a New Fund Offer (NFO). During the NFO, investors are allotted units at par value (usually ₹10) — an investment of ₹10,000 would be allotted 1,000 units. You need to be KYC compliant to invest; your advisor can help you fulfil this along with providing bank details, since investors can invest only from their own bank accounts.

After the NFO, money pooled from investors is invested in a diversified portfolio per the scheme's mandate. For open-ended schemes, you can buy or redeem units at any time at the prevailing Net Asset Value (NAV); redemption proceeds are typically credited on T+3 for equity funds. Exit loads may apply for redemptions within a certain period of investment.

Different types of mutual funds

Equity funds invest in equity and equity-related securities, with sub-categories by market cap (large cap, midcap, small cap, multicap, flexicap, etc.). The primary objective is capital appreciation.

Debt funds invest in debt and money market instruments, with sub-categories by maturity profile (overnight, liquid, short duration, medium duration, long duration, etc.).

Hybrid funds invest in both equity and debt, and sometimes gold, REITs or InvITs. The primary objective is asset allocation — types include aggressive hybrid, conservative hybrid, balanced advantage and equity savings funds.

Different categories carry different risk profiles, so mutual funds can suit a wide range of risk appetites and needs. Your advisor can help you select the right option.

Taxation of mutual funds

Funds with average equity allocation of 65% or more are treated as equity funds for tax purposes. Short-term gains (held under 12 months) on equity funds are taxed at 15%; long-term gains are tax-free up to ₹1,00,000 and taxed at 10% thereafter. For non-equity funds, short-term gains (held under 36 months) are taxed at the investor's income-tax slab rate, and long-term gains (held over 36 months) at 20% with indexation. ELSS investments qualify for deductions under Section 80C.

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Small Savings

The Government of India offers several small savings schemes — the Public Provident Fund (PPF), Senior Citizen Savings Scheme (SCSS), National Savings Certificate (NSC), Sukanya Samriddhi Yojana (SSY), Kisan Vikas Patra (KVP) and various post-office deposit schemes — designed to provide safe, attractive investment options while mobilising resources for development.

These schemes are popular for offering returns generally higher than bank fixed deposits, backed by a sovereign guarantee and income-tax benefits. Since 2016, the Finance Ministry has reviewed interest rates on small savings schemes quarterly. Deposits are pooled into the National Small Savings Fund, which the Central Government uses to finance its fiscal deficit.

Post office time deposits work much like bank fixed deposits, with a minimum investment of ₹1,000. Investments under the 5-year time deposit, up to ₹1.5 lakh in a financial year, qualify for benefit under Section 80C.

The Public Provident Fund is a popular option for tax saving and long-term goals like retirement, a child's higher education or wealth creation. It currently pays 7.1% a year and qualifies under Section 80C. On maturity after 15 years, it can be extended indefinitely in 5-year blocks; the accumulated amount and interest are tax-exempt at withdrawal, and a loan is available after 5 years.

The Sukanya Samriddhi Account, launched in 2015 under Beti Bachao Beti Padhao, is exclusively for a girl child below age 10. It guarantees 7.6% per annum, qualifies under Section 80C, runs for 21 years from opening, and allows up to ₹1.5 lakh a year.

These time-tested, safe instruments don't offer quick returns, but they're considerably safer than market-linked investments. At Shahdadpuri & Associates, we help you invest in small savings schemes from the comfort of your home.

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Fixed Deposits

Fixed deposits remain one of the most popular investment options in India — RBI data shows more than half of household financial assets are held in bank FDs. Corporate FDs, offered by non-banking financial companies (NBFCs) rather than banks, work the same way but tend to offer higher returns to informed investors.

Bank FD vs. Corporate FD

Rate of return: Corporate FD rates are usually higher than bank FD rates, varying by the issuing company's credit rating.

Tenure: Bank FDs range from 7 days up to 10 years; corporate FDs typically run from 12 months to 4–6 years. For very long tenures, a bank FD is usually the only option.

Lock-in period: Bank FDs have no lock-in. Corporate FDs often carry a lock-in — commonly 3 months — though not all do.

Premature withdrawal: Both allow early withdrawal, usually with a penalty. Bank FDs tend to be more flexible here, with no lock-in and typically lower penalties — a trade-off worth weighing against the higher returns corporate FDs offer.

Taxation: Interest from both bank and corporate FDs is added to your income and taxed at your applicable income-tax slab rate.

Points to consider before investing in corporate FDs

Interest rate — compare rates across NBFCs, but weigh this alongside credit risk rather than in isolation.

Credit risk — the risk that the NBFC fails to meet its interest or principal obligations; check the credit rating before investing.

Tenure — rates are usually higher for longer tenures, so choose based on your investment horizon.

Interest pay-out — periodic (monthly, quarterly, half-yearly or yearly) or cumulative, where interest is reinvested for the benefit of compounding. The right choice depends on your income needs.

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RBI Bonds

What are bonds?

Bonds are fixed-income instruments that pay a fixed rate of interest at regular intervals and return the principal on maturity. They're a well-established asset class in developed economies; in India, the bond market has traditionally been smaller, but bonds have gained popularity with retail and HNI investors as bank FD rates have declined.

How do bonds work?

Bonds can be bought in the primary market (when first issued, at face value) or the secondary market via stock exchanges (which requires a Demat account, and where price may sit at a premium or discount to face value depending on prevailing rates). Bonds pay periodic interest based on their coupon rate, return the face value at maturity, and can also be sold before maturity at the prevailing market price.

Key terms in bond investing

Secured / unsecured — a secured bond is backed by collateral that can be sold to repay investors if the issuer defaults, giving it materially lower credit risk than an unsecured bond.

Face value — the amount repaid at maturity, and the base on which the coupon is calculated; the bond may trade above or below this in the secondary market.

Coupon rate — the periodic interest rate; a ₹1,000 face-value bond with an 8% coupon pays ₹80 a year.

Frequency of coupon payments — how often interest is paid (half-yearly, annual, etc.).

Redemption date — the maturity date, when you receive the face value plus any accrued interest.

Accrued interest — interest built up since the last coupon date; included in a bond's "dirty price" (clean price = dirty price − accrued interest).

Yield to maturity (YTM) — the return if held to maturity, assuming coupons are reinvested at the same rate; accounts for both coupon payments and the face-value repayment.

Duration — a measure of a bond's interest-rate sensitivity; longer duration means greater sensitivity to rate changes.

Bond rating — assigned by agencies such as CRISIL and ICRA; higher ratings mean lower credit risk (and typically lower YTM), lower ratings the reverse.

Different types of bonds

Corporate bonds — secured bonds issued by companies.

Sovereign Gold Bonds (SGBs) — gold-backed bonds issued by the RBI on the Government's behalf.

Government Securities (G-Secs) — sovereign-guaranteed bonds issued by the RBI for the Government of India.

Non-Convertible Debentures (NCDs) — unsecured bonds issued by companies.

RBI Bonds — the Floating Rate Savings Bonds, 2020 (Taxable), launched for resident Indians and HUFs with no investment ceiling. The tenure is 7 years, interest is paid semi-annually (1 January and 1 July), and the coupon resets every six months against the National Savings Certificate rate plus a fixed spread.

Capital gain bonds (54EC bonds) — let you save long-term capital gains tax on the sale of an asset like property by investing the gain within 6 months of sale, up to ₹50,00,000. Eligible issuers include REC, PFC, NHAI and IRFC, typically with a 5-year tenure.

Interested in any of these? Get in touch and we can help you invest.

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Insurance

Term, health and life cover assessed and sized to what your family or business actually needs.

• Life Insurance →
• Health Insurance →

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Life Insurance

Life insurance is a financial product that provides the policyholder's family financial protection in the event of an unfortunate death. Anyone who is working and has dependents — children, a spouse, retired parents — needs life insurance, since an untimely death would deprive the family of income and cause financial distress. If you carry debt such as a home loan or car loan, life insurance becomes an even more critical need.

How does a life insurance plan work?

A life insurance policy provides your dependents financial protection over a certain period (the policy term) in the event of an unfortunate death. The amount of protection is known as the sum assured, or cover — the amount your dependents receive if death occurs during the policy term.

How much cover should you buy?

It depends on your income and your family's needs. The income from your cover should meet your dependents' needs for a long period, or at least until they become financially independent — for instance, when your children start working. If you carry debt such as a personal loan or home loan, your cover should be large enough to repay it in the event of an unfortunate death. A common rule of thumb is that your sum assured should be at least 10 to 12 times your annual income.

What is the cost of a life insurance policy?

The cost of a policy is known as the premium, typically payable annually (or monthly, quarterly, etc.) through the policy term, or over a shorter period as specified. Single-premium policies also exist, where the entire premium is paid up front — since it's a lump sum, insurers usually offer a discount. Your premium depends on factors including the sum assured, your age, pre-existing medical conditions (diabetes, hypertension, etc.), lifestyle habits (such as smoking), and any additional riders you choose (accident, critical illness, etc.).

Different types of life insurance plans

Term life insurance provides cover over the policy term with no survival benefits — a pure protection plan. For example, a ₹1 crore term plan over 20 years pays your dependents ₹1 crore in the event of death, but nothing if you survive the term. Premiums are much lower than other types of life insurance.

Traditional life insurance plans differ from term plans in that they include survival benefits: you receive the sum assured if you survive the policy term, along with guaranteed additions to the sum assured after a specified number of years, and reversionary bonuses at the insurer's discretion. These are insurance-cum-investment plans, combining life cover with a return on your premiums at maturity.

Unit Linked Insurance Plans (ULIPs) are also insurance-cum-investment plans, but market-linked: part of your premium provides life cover, and part is invested in market securities such as stocks and bonds — similar to a combined term plan and mutual fund. Because ULIPs are subject to market risk, returns can be higher than traditional plans, but a loss is also possible. Different ULIPs carry different risk profiles; your advisor can help you choose one suited to your risk appetite.

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Health Insurance

The cost of quality healthcare in India has risen sharply over the past decade. Hospitalisation for a serious health condition can cost anywhere from ₹5 to ₹10 lakh, depending on severity and treatment.

Health insurance covers comprehensive hospitalisation expenses related to accident and illness, typically including:

• Room and boarding expenses for the hospital bed
• Fees charged by physicians, surgeons, anaesthetists and other specialists
• Cost of medical procedures — surgery, dialysis, and similar
• Cost of medicines, medical equipment and consumables
• Tests and procedures — X-ray, ECG, MRI, anaesthesia, and similar

Some policies also cover pre-hospitalisation expenses such as tests and diagnosis, up to the limit of your sum insured. If your sum insured is ₹5 lakh and your hospital bill comes to ₹6 lakh, the insurer pays ₹5 lakh and you're responsible for the remaining ₹1 lakh.

Cashless vs. reimbursement claims

In a cashless claim, you don't pay out of pocket — the insurer settles your medical bills directly with the hospital. In a reimbursement claim, you settle the hospital bill yourself and claim it back from the insurer afterward. Cashless claims are far more convenient, but require treatment at a hospital within the insurer's network.

What determines your premium?

Your premium depends on the sum insured, your age (and the ages of family members on a floater plan), pre-existing medical conditions, the features you opt for (which illnesses and procedures are covered, exclusions, room type — single, shared or deluxe), and co-pay terms (the percentage of expenses, e.g. 20%, you bear during hospitalisation). There's a lot to weigh when choosing a health insurance policy — your advisor can help recommend the right one for your needs.

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Tax Advisory

Direct and indirect tax planning, compliance and advisory for individuals, families and businesses.

• GST Advisory →
• Income Tax Advisory →
• NRI Taxation →
• Transfer Pricing →

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GST Advisory

GST was one of the biggest tax reforms in India's history. Any business crossing the registration threshold — ₹40 lakh turnover for goods, ₹20 lakh for services — must register under the Goods and Services Tax Act. If a registered dealer no longer meets the criteria, registration can also be cancelled through a straightforward process.

GST registration by entity type

Company: Certificate of Incorporation, directors' KYC and photo, bank details, registered office proof.

LLP: Certificate of Incorporation, designated partners' KYC and photo, bank details, registered office proof.

Partnership firm: Partnership deed, partners' KYC and photo, bank details, registered office proof.

Individual / small business: Individual KYC, photo, registered office proof, bank details.

Foreign documents such as the MOA, AOA, Certificate of Incorporation, board resolutions and passport copies need to be in English, apostilled and notarised in the home country.

GST return filing

GST compliance is entirely online, with several returns filed on a regular schedule: GSTR-3B (monthly summary return), GSTR-1 (outward supplies, monthly or quarterly), GSTR-2A (auto-drafted inward supplies), GSTR-4/4A (for the composition scheme), GSTR-5 (non-resident taxable persons), GSTR-9 (annual return), and GSTR-9C (reconciliation statement and GST audit certificate).

Filing on time matters — missing the GSTR-3B due date (the 20th of the following month) attracts a penalty of ₹50 per day (₹20 for a nil return). Input tax credit is available only once the corresponding purchase is reflected in GSTR-2A; if it isn't, the credit needs to be reversed. At year-end, GSTR-9 must reconcile with the GSTR-3B, GSTR-1 and GSTR-2A returns filed through the year, and businesses above ₹2 crore turnover require a GST audit by a chartered or cost accountant.

Input credit adjustment & reverse charge

Since Section 49A took effect, input tax credit on IGST must be fully utilised first — against IGST, then CGST, then SGST liability — before CGST or SGST credit can be used against their respective liabilities; CGST and SGST credits cannot be cross-utilised against each other.

Under the reverse charge mechanism, the recipient of goods or services — rather than the supplier — becomes liable to pay GST, most notably when receiving supplies from an unregistered dealer. This widens the tax base to cover transactions that would otherwise sit outside it, though the GST must be paid in cash before the corresponding credit can be claimed.

GST compliance can be intricate, especially around timing, reconciliation and reverse charge — we help businesses stay compliant and avoid the penalties that come with missed deadlines or mismatched returns.

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Income Tax Advisory

Tax law changes frequently as the economy evolves, and with a growing number of domestic and overseas taxpayers, individuals and businesses increasingly need professional advice to stay compliant and file correctly.

Corporate income tax advisory

We advise corporate clients on the complexities of corporate taxation, including DTAA provisions, withholding tax and tax on foreign remittances — areas where the provisions themselves, and their practical application, can be difficult to navigate without expert guidance.

Individual tax advisory

Individual taxpayers face a taxation framework that changes substantially most years, and often need professional guidance on:

Allowance deductions from salary (such as HRA); home loan principal and interest deductions; income from house property and applicable deductions, including carrying forward losses; capital gains on the sale of house property and how to save tax on them; capital gains on the sale of shares and securities; deductions under Chapter VI-A; income from other sources such as interest; and short-term versus long-term capital gains treatment generally.

Getting these wrong — or filing without considering all applicable provisions — can trigger a defective-return notice under Section 139(9), an unexpected tax demand, or a smaller refund than you're entitled to. Capital gains on property sales, and the exemption available under Section 54, are a particularly common area where advice pays for itself: missing the prescribed reinvestment window can mean a heavy, avoidable tax liability.

Representation services

When a tax assessment moves beyond routine filing, representation before the tax authorities requires experience — understanding the process and being able to respond to the questions raised during it. We represent clients through:

Summary assessment (Section 143(1)); scrutiny assessment (Section 143(3)); best judgment assessment (Section 144); reassessment (Section 147); and block assessment (Section 153A).

TDS on sale of property

Where a property sale is worth ₹50 lakh or more, the buyer must deduct 1% TDS from the sale consideration (on the whole consideration, not just the amount above the threshold) — below that value, no TDS applies. The buyer doesn't need a TAN to deduct this TDS, but the seller must have a PAN, or the deduction rises to 20%. TDS must be deducted at the time of payment or credit, whichever is earlier, deposited via Form 26QB within 30 days of the month-end in which it was deducted, and followed by a Form 16B certificate to the seller, available on the TRACES website roughly 10–15 days after deposit.

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NRI Taxation

NRI taxation is a distinct and often complex area of practice — it requires a careful review of all income connected to an NRI's situation and correct application of the relevant provisions from the outset. Missing a relevant aspect at the filing stage can lead to a notice later, whereas a thorough review upfront, with proper professional input, means there's little to worry about even if the return is later scrutinised.

We work with NRI clients to assess their full income picture — across India and abroad, where relevant to Indian tax law — and to file correctly the first time, rather than dealing with complications after the fact.

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Transfer Pricing

Transfer pricing refers to the prices charged on transactions between related parties — such as a parent company and its subsidiary — which can differ from what independent, unrelated parties would have agreed to.

For example: Company X buys goods for ₹1,000 and sells them to its associate, Company Y, in another country for ₹2,000 — Company Y then sells them in the open market for ₹4,000. Had Company X sold directly into that market, it would have earned a ₹3,000 profit; by routing the sale through Company Y at an arranged, below-market transfer price, ₹2,000 of profit is effectively shifted to Company Y's country instead of reflecting the ₹4,000 market price.

To protect tax revenue, Chapter X of the Income-tax Act, 1961 sets out specific transfer-pricing provisions, built around the principle that international transactions between associated enterprises should be priced at "arm's length." Almost any entity with cross-border related-party dealings runs into this issue — we help such entities determine the right transfer price and prepare the required reports within statutory timelines.

Our transfer pricing services include

Planning & documentation — assistance with transfer pricing planning and preparing the required study and documentation.

Transfer pricing audit — preparing Form 3CEB and related audit filings.

Country-by-country reporting — compliance for larger multinational groups.

Representation — before the Transfer Pricing Officer, and in litigation before higher authorities including the CIT (Appeals), the Dispute Resolution Panel and the Income Tax Appellate Tribunal (ITAT).

With practical experience across a range of business and economic scenarios, we aim to give CFOs and tax managers technically sound, implementable advice on transfer pricing within their group companies.

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Project Finance & Fund Raising

Structuring and raising debt and equity capital for business growth, expansion and project needs.

We advise businesses on raising and structuring finance for long-term infrastructure and commercial projects, helping simplify what can otherwise be a complex process of approaching lenders and structuring the right facility for the situation.

Our project finance services include

CMA data preparation — putting together the Critical Monetary Analysis data lenders require to assess a proposal.

Bank finance assistance — helping you approach and secure financing from banks.

Overdraft limit and cash credit limit — arranging short-term credit facilities against your working capital needs.

Working capital finance — funding for day-to-day operational requirements.

Term loan — structured financing for capital expenditure and longer-term needs.

Letter of credit — arranging trade-finance instruments for supplier and buyer transactions.

Interim finance for IBC cases — funding support during insolvency resolution proceedings.

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Account Outsourcing & Bookkeeping

Day-to-day bookkeeping, reconciliations and financial reporting handled end-to-end.

Transparency in accounting gives a business the right direction to go ahead. It's easy for finances to slip while you're focused on running the organisation — our outsourced back-office accounting service gives you experienced staff accountants, with the scope tailored to what your organisation actually needs.

We act as an outsourced partner, taking on responsibility for routine accounting processes so your management team can focus on the more strategic parts of the business — wherever in the world your operations are based.

Our accounting services include

Bookkeeping — trained staff use technology to process transactions daily, recording all financial activity methodically to leave little room for errors.

Financial statement preparation — balance sheet, income statement (profit & loss), statement of retained earnings and cash flow statements.

Management accounts — regular reporting that gives company leadership the information they need to make decisions.

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Auditing & Assurance

Statutory, internal and management audits providing independent assurance over your financial statements.

What is an audit?

An audit is an independent, systematic examination of an organisation's financial statements to confirm they present a true and fair view of its transactions and operations. It can be carried out internally by an organisation's own staff, or externally by a chartered accountancy firm.

What is an assurance service?

Assurance services are an independent professional service, typically provided by chartered accountants, that verify the correctness and validity of a financial document or transaction — a loan, contract or arrangement, for example. Businesses use assurance services to improve the quality, transparency and credibility of the information they share with the market, investors and other stakeholders.

Our audit & assurance services include

Statutory audit — a legally required review of a company's financial statements and books of account, assessing whether they present a true and correct picture of its financial position.

Tax audit — an audit of financial records for compliance with the Income-tax Act, covering income tax, GST and other applicable taxes.

Stock audit — physical verification of inventory to reconcile actual stock against what's recorded in the books.

Revenue audit — checking data and figures reported in tax returns against actual business records.

Internal audit — an assurance and consulting activity that helps an organisation strengthen its risk management, controls and governance.

Fixed assets audit — verifying that capital assets and depreciation are accounted for correctly, supporting an accurate balance sheet and stronger internal controls.

Management audit — reviewing the functioning of an operational department, often in the context of acquisitions or mergers, to improve efficiency.

Due diligence — in-depth review of financial information and records before entering into a proposed transaction or deal.

How we help

We stay current with developments in auditing standards and the regulatory environment, and take time to understand your operations before an audit begins, so the process is tailored to your business rather than a one-size-fits-all checklist. Audits are planned and staffed so they don't interfere with day-to-day operations, and we aim to flag not just compliance issues but areas of potential improvement along the way.

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Privacy Policy

The user's right to privacy is of paramount importance to Shahdadpuri & Associates. Any information provided by users will not be shared with any third party. Shahdadpuri & Associates reserves the right to use the information to provide the user a more personalised online experience. In general, you can visit without telling us who you are and without revealing any information about yourself. At times, however, we may need more information from you.

Shahdadpuri & Associates does not rent, sell, or share personal information about you with other people or non-affiliated companies except to provide products or services you've requested, when we have your permission, or under the following circumstances: we provide information to trusted partners who work on behalf of, or with, Shahdadpuri & Associates under strict confidentiality agreements. These companies may use your personal information to help Shahdadpuri & Associates communicate with you about product and service offerings from us and our marketing partners; however, they do not have any independent right to share this information. Shahdadpuri & Associates may use browser-based cookies primarily to identify you on subsequent visits to our website. At times, information from cookies may also be used to customise the services for you. Please note that should you disable your browser from accepting cookies, some information or services may not be accessible to you.

Unless required by a court of law, we do not reveal any information pertaining to the user or your usage data. We do not block access to users of any age, as we expect financial literacy to be an integral part of one's life, and in our endeavour to spread awareness, users may need to go through the articles, knowledge and blog sections published on this website. We believe that users under 15 years of age would have permission from their parents or guardian before using any information published on this website. Users should also check local country laws and regulations on accessing financial awareness and literacy websites before accessing Shahdadpuri & Associates. Registered users are those who willfully provide us their details — name, contact number, email ID and other demographics, etc.

We would normally communicate with registered users of the site through email, telephone and mailers, etc., but from time to time we may need to communicate with other users as well. Any incorrect data may be reported to us for correction. Shahdadpuri & Associates does not take responsibility for the correctness and safety of user data, but we take due care to maintain the safety and integrity of data. We update our privacy policy from time to time as we add more products, services and features to our website to spread financial literacy. Please visit this page regularly to view the latest details of our privacy policy.

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FAQ

Mutual Funds

What is a Mutual Fund?

A mutual fund is a financial instrument which pools the money of different people and invests it in different financial securities such as stocks and bonds. The Asset Management Company (AMC) — the company that manages the mutual fund — raises money from the public and deploys it by investing in securities selected to match the fund's investment objective.

How do AMCs manage mutual fund investments?

The AMC raises money from the public and deploys it by investing in different financial securities, chosen to match the fund's investment objective. For example, a fund with a capital-appreciation objective will invest in shares of different companies, while a fund aiming to generate income will invest in fixed-income securities that pay interest.

Each investor in a mutual fund owns units of the fund, representing a portion of its holdings. On an ongoing basis, fund managers manage the portfolio to keep it aligned with the stated investment objective. For the services they provide, AMCs incur expenses and charge a fee to unit holders — these are charged proportionately against the fund's assets and reflected in the unit price. Mutual funds are bought and sold on the basis of Net Asset Value (NAV). Unlike share prices, which move constantly during market hours, NAV is computed once a day, at the end of the day, based on the closing prices of all the securities the fund holds.

What are Open Ended & Close Ended Mutual Funds?

There are two kinds of mutual funds. Open-ended schemes let investors buy units at any time, and sell them at any time too — though some schemes (such as ELSS) carry a lock-in period during which units can't be sold. Ownership percentage shifts as investors buy or sell, and because units can be redeemed any time, these schemes offer high liquidity, though costs may apply if you exit before a certain holding period.

Close-ended schemes are open for subscription only during a limited offer period (the New Fund Offer, or NFO), after which the tenure is fixed and investors can typically redeem only at maturity. Some close-ended schemes are listed on stock exchanges, where they can be bought or sold through a demat account, though liquidity there tends to be low.

What are the advantages of mutual funds?

Risk diversification — mutual funds spread investment across many stocks and securities, sectors and market caps, which an individual investor would need a much larger sum to replicate directly. Professional fund managers handle the stock-picking.

Economies of scale — because funds transact in large volumes, per-unit transaction costs are lower than an individual buying or selling directly.

Tax efficiency — long-term capital gains (over 1 year) on equity and equity-oriented funds are exempt up to ₹1,00,000. Debt funds lost their indexation benefit from 1 April 2023 and are now taxed at the investor's slab rate, bringing them roughly in line with fixed deposits. ELSS investments up to ₹1,50,000 a year qualify for deduction under Section 80C.

High liquidity — open-ended funds can usually be redeemed, fully or partially, at any time, with a standardised process across funds.

Variety — equity, income, tax-saving (ELSS), balanced, monthly income and liquid funds cover a wide range of needs, with flexible modes of investing (lump sum, SIP, STP or switching between schemes).

What are Mutual Fund Units?

Units are the building blocks of a scheme — each one represents a share of the total pool of money the AMC manages. Units are typically priced at ₹10 at launch (the NFO), and that price moves with the value of the scheme's underlying assets. If you invest ₹1,00,000 at a unit price of ₹10, you're allotted 10,000 units; as the fund's total asset value rises or falls, so does the unit price, and your percentage ownership shifts as other investors buy in or redeem.

What is NAV in mutual funds?

Mutual funds are bought and sold at Net Asset Value (NAV) — essentially the price of one unit, calculated as the fund's net assets (market value of its holdings plus cash, minus liabilities) divided by the number of units outstanding. Unlike share prices, which move throughout the trading day, NAV is calculated once, at the end of each day. A high or low NAV by itself says nothing about whether a fund is cheap or expensive — it's the percentage change in NAV over time that reflects returns.

What is an Expense Ratio?

The expense ratio is the AMC's annual cost of running a scheme, expressed as a percentage of its total assets — covering the fund manager, supporting infrastructure, transaction costs, and distribution commissions. A scheme with ₹500 crore in assets and a 1.5% expense ratio incurs ₹7.5 crore a year in costs, deducted pro-rata from the fund's value; NAV is always quoted net of this expense.

What are Regular Plans and Direct Plans?

Investing through an AMFI-certified distributor puts you in a scheme's regular plan — the distributor earns a commission from the AMC for advice and transaction support. Investing directly with the AMC, without a distributor, puts you in the direct plan, which carries a lower expense ratio (since no distributor commission is paid) and therefore slightly higher returns — but requires you to research, decide and manage the investment yourself.

What is an Exit Load?

An exit load is a fee an AMC may charge if you redeem units within a specified period of investing — for example, 1% on redemptions within 12 months. If you invested ₹1,00,000 (5,000 units at a NAV of ₹20) and redeemed after 8 months at a NAV of ₹23, a 1% exit load would deduct roughly ₹1,150 from your ₹1,15,000 redemption value. Exit loads can also apply to switches, STPs and SWPs made within the load period.

What are Growth and Dividend Options in a Mutual Fund Scheme?

These describe how a scheme's profits are paid out. In the growth option, profits are reinvested, so the NAV compounds upward over time. In the dividend option, profits are distributed to investors periodically (annually, quarterly, monthly, etc.) on a per-unit basis, and the NAV resets lower after each payout. Growth options tend to deliver higher capital appreciation over a long horizon; dividend options suit investors who want periodic income. A dividend reinvestment option sits in between — payouts are used to buy more units rather than being paid out, so you gain through additional units rather than NAV growth; tax treatment differs between the two.

Debt & Money Market Funds

What are fixed income or debt mutual funds?

Debt funds invest in fixed-income instruments — treasury bills, commercial paper, certificates of deposit, corporate and government bonds — spanning maturities from a few months to 30 years or more. Short-maturity debt funds mainly aim to generate income; longer-maturity funds aim for income plus capital appreciation. Unlike bank deposits, debt funds aren't risk-free: they carry interest rate risk (higher for longer-maturity funds) and credit risk (mainly relevant for corporate bond funds, though most hold predominantly AAA/AA-rated paper).

What are the different types of debt mutual funds?

There are broadly seven categories: Gilt funds invest in government securities with long average maturities (15–30 years) and are highly interest-rate sensitive, aiming for capital appreciation. Income funds mix shorter and longer maturities (averaging 7–20 years) for a blend of accrual income and duration calls. Short-term debt funds hold commercial paper, CDs and short bonds (2–3 year average maturity) for stable income with low risk. Credit opportunities funds are similar but take on slightly lower-rated (though still mostly AAA/AA) bonds for a bit of extra yield. Fixed Maturity Plans are close-ended, holding bonds to maturity to match the scheme's fixed tenure, giving very stable returns. Liquid funds invest in short-term money market instruments (residual maturity up to 91 days) for high liquidity with low risk, no exit load, and quick redemption. Monthly Income Plans are debt-oriented hybrids (roughly 75–80% debt, 20–25% equity) aiming for a bit more return than pure debt funds, at slightly higher risk.

What are money market mutual funds?

Money market funds are open-ended debt funds investing solely in short-term, highly liquid instruments — treasury bills, CDs, commercial paper, term deposits — aiming for returns without compromising safety or liquidity. Liquid funds hold instruments maturing in 91 days or less; ultra-short-term bond funds hold instruments maturing in 6–12 months, which can mean slightly higher returns but also slightly more volatility.

What are liquid funds?

Liquid funds offer an alternative to idle savings-account cash: where savings accounts typically pay 4–5%, liquid funds can potentially do better, with comparatively low risk. Key advantages: high liquidity (no exit load, redeemable any time), better returns than a savings account, and low volatility, since the short-duration instruments they hold carry limited interest-rate risk.

Mutual Funds vs. Other Products

What is the difference between ULIPs and mutual funds?

A Unit Linked Insurance Plan (ULIP) combines life insurance with investment — market-linked, unlike traditional endowment or money-back plans, but without the capital safety those traditional plans offer. A mutual fund is purely an investment vehicle, pooling investor money into securities with no insurance component. Gross ULIP and mutual fund returns can look comparable over a 5-year period, but ULIP net returns tend to be lower once premium allocation fees, policy administration charges and the cost of life cover are deducted before the balance is actually invested.

What is the difference between ETFs and mutual funds?

An Exchange Traded Fund (ETF) is a basket of stocks tracking an index (such as the Sensex or Nifty), traded on an exchange like a stock — its price moves in real time through the day, unlike a mutual fund's once-daily NAV. Mutual funds are actively managed, aiming to outperform a benchmark; ETFs are passively managed, aiming only to track one. Mutual funds target specific objectives (capital appreciation, income, a particular market-cap focus); ETFs just aim to minimise tracking error against their index. Investing in ETFs requires a demat account; mutual funds generally don't.

Understanding Mutual Fund Returns

Absolute Return is simply the growth in your investment, in percentage terms, with no regard for how long it took. ₹1,00,000 growing to ₹1,40,000 is a 40% absolute return — whether that happened over 3 years or 5.

Annualized Return measures growth on a yearly basis and includes the effect of compounding. The same ₹1,00,000 → ₹1,40,000 move works out to roughly 11.9% annualised over 3 years, or about 7% over 5 years — both lower than the raw absolute-return-divided-by-years figure, because of compounding.

Total Return includes both capital gains and any dividends paid. If ₹1,00,000 bought 5,000 units at a NAV of ₹20, and after a year the NAV is ₹22 with ₹2/unit paid in dividends, you'd have ₹10,000 in capital gains plus ₹10,000 in dividends — a 20% total return.

Trailing Return is the annualised return over a set period ending today (1, 3, 5, 10 years, etc.) — the figure most commonly shown on fund websites. Because it's anchored to today, trailing returns run high in bull markets and low in bear markets, so they carry a recency bias.

Point-to-Point Return measures annualised return between two specific, user-chosen dates — useful for looking at how a fund performed over a particular historical stretch.

Annual Return is the return from the first to the last business day of a calendar year. Comparing a fund's annual returns across several years, against its benchmark or category, gives a sense of how consistent its performance has been.

Rolling Returns take the annualised return over a fixed window (say, 3 years), recalculated on every single day across a longer history, and compared to a benchmark or category. Widely used globally but less common in India, rolling returns avoid the recency bias of trailing returns and the narrow-window bias of point-to-point returns, and are considered one of the better ways to judge a fund manager's consistency.

Quartile Ranking measures relative — not absolute — performance: funds in a category are ranked by trailing return over a chosen period and split into four bands, from Top Quartile (best 25%) to Bottom Quartile (worst 25%). A fund's consistency in quartile ranking across several periods often matters more than any single quarter's rank.

SIP Returns / XIRR: since a SIP involves a series of cash flows rather than a single lump sum, the usual return measures don't directly apply. Returns on SIPs, STPs and SWPs are instead calculated using the Internal Rate of Return (IRR), or XIRR when the cash flows aren't at exact regular intervals.

Types of Equity Mutual Funds

Equity funds invest in shares with the primary aim of capital appreciation over a medium-to-long horizon. They carry higher risk, with returns tied to the stock market, and suit investors with a longer time frame.

Diversified equity funds spread investments across a large number of stocks and sectors, aiming to reduce company- and sector-specific risk. A stricter definition (used by some research houses) also requires spreading across market-cap segments — large, mid, small and micro cap — in which case these are often called flexicap or multicap funds.

Large cap equity funds invest in the largest companies by market capitalisation (broadly, those covering the top 80% of total listed market cap). These tend to be well-established, well-researched "bluechip" names with a long track record.

Mid cap equity funds invest in the next tier of companies (roughly ₹25,000–70,000 crore market cap) — less well known and more volatile than large caps, with somewhat lower liquidity in extreme markets.

Small cap equity funds invest in smaller companies still (roughly ₹10,000–25,000 crore), carrying higher volatility and risk than mid caps, with lower liquidity.

Sectoral funds concentrate on a single industry — banking, pharma, technology, infrastructure and so on — and can be highly volatile, since returns depend heavily on whether that sector is in or out of favour.

Balanced funds hold a mix of equity (typically a minimum of 65%) and debt, aiming to combine the growth potential of equities with the relative stability of fixed income — a middle ground between a pure equity fund and a pure debt fund.

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Commission Disclosures

Commission structure on trail basis, in annualised percentage.

Note

Commissions quoted are on an annualised basis; there are no upfront brokerages.

The commission structure above pertains to the quarter October–December 2026.

This structure pertains only to large cities where these schemes get distributed.

Figures are provided on the basis of communication received from the respective AMCs, and are subject to change each quarter — we'll update this page accordingly.