Do Debt Funds Have Lock In Period?

Are debt funds tax free?

Long term capital gains upto Rs 1 Lakh is totally tax free.

Short term capital gains (if the units are sold before three years) in debt mutual funds are taxed as per applicable tax rate of the investor.

Therefore, if your tax rate is 30% then short term capital gains tax on debt fund is 30% + 4% cess..

Do liquid funds have lock in period?

Liquid funds do not come with a lock-in period. The redemption of liquid funds is processed within 24 hours on business days. Liquid funds possess the lowest interest risk among all classes of debt funds as they mostly invest in fixed-income securities that mature soon.

What is debt fund with example?

Definition: Debt funds are mutual funds that invest in fixed income securities like bonds and treasury bills. Gilt fund, monthly income plans (MIPs), short term plans (STPs), liquid funds, and fixed maturity plans (FMPs) are some of the investment options in debt funds.

When should you buy debt funds?

The simple thumb rule for investing in debt is: when the interest rates are around or below 6%, it is better to invest in debt funds like liquid funds or ultra-short duration funds or low duration funds. Or it could be even short-term fixed deposits with banks. … The interest rate risk always exists in debt investment.

Is Debt Fund better than FD?

Debt funds are tax-efficient as compared to fixed deposits. The interest from bank fixed deposits are added to your taxable income and taxed as per your income tax bracket. … Debt funds are tax-efficient as compared to bank FDs if you fall in the higher income tax bracket and have an investment horizon above three years.

Which debt fund gives highest return?

5. Top 10 Best Debt Mutual Funds in IndiaFund name3-year returnsRatingsAditya Birla Sun Life Corporate Bond Fund Regular Plan Growth9.31%5HDFC Corporate Bond Growth9.36%5Axis Dynamic Bond Fund Growth9.67%5ICICI Prudential Long Term Bond Fund Growth9.8%5/56 more rows•6 days ago

Is there any risk in debt funds?

Investing in debt funds carries various types of risk. These risks include Credit risk, Interest rate risk, Inflation risk, reinvestment risk etc.

What is Blue Chip Fund?

A blue-chip mutual fund is the one that invests in blue-chip stocks or shares, i.e. in well-established companies with excellent overall financial performance.

Do debt funds have exit load?

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.

Which is the safest debt fund?

SynopsisScheme nameInception dateCategoryICICI Pru Corporate Bond Gr11-08-2009Corporate BondKotak Bond S/T Reg Gr02-05-2002Short DurationL&T Money Market Gr10-08-2005Money Market FundSBI Savings Reg Gr19-07-2004Money Market Fund30 more rows•Jul 17, 2020

Is mutual fund is safe to invest?

In a nutshell, mutual funds are safe. Investors should not be worried about short-term fluctuations in the returns while investing in them. You should choose the right mutual fund, which is sync with your investment goal and invest with a long-term horizon.

Are debt funds risk free?

Debt funds aren’t risk free. They cannot be. They are designed to generate returns that are potentially higher than those from risk-free instruments. Hence, they will take risks.