What is FMP?
Fixed Maturity Plans (FMP Mutual Funds) are the vogue in the mutual fund - New Fund Offers (NFO) market. Not too long time ago the return on FMP in the new fund offers had virtually disappeared. Few years ago, after the breakdown in FMP mutual funds, fixed maturity plans had been despised by high individuals (HNIs), retail and institutional investors in India.Today, New Fixed Maturity Plans have been introduced which have received a great response from institutional, corporate and retail investors.
Fixed Maturity Plans (FMP Mutual Funds) are the vogue in the mutual fund - New Fund Offers (NFO) market. Not too long time ago the return on FMP in the new fund offers had virtually disappeared. Few years ago, after the breakdown in FMP mutual funds, fixed maturity plans had been despised by high individuals (HNIs), retail and institutional investors in India.Today, New Fixed Maturity Plans have been introduced which have received a great response from institutional, corporate and retail investors.
So where do Fixed Maturity Plans invest in?
Fixed Maturity Plans, more popularly known by their acronym “FMP” are debt funds, that invest in Government securities and company debt. That means that fixed maturity plans,typically have no equity component, unless you invest in a FMP that chooses to have a limited equity component
And are Fixed Maturity Plans close-ended mutual funds?
Yes, apart from investing in debt, fixed maturity plans belong to the breed of close-ended funds. Again for the MBA pack, close ended funds mean that fixed maturity plans have a definite end date
Being close ended funds, fixed maturity plans offer flexibility to their fund managers and let them plan on their exact investments even at the IPO stage. As a result, even investors can know in advance about the approximate yields they can get by investing in these FMPs at the IPO stage.
Fixed Maturity Plans, more popularly known by their acronym “FMP” are debt funds, that invest in Government securities and company debt. That means that fixed maturity plans,typically have no equity component, unless you invest in a FMP that chooses to have a limited equity component
And are Fixed Maturity Plans close-ended mutual funds?
Yes, apart from investing in debt, fixed maturity plans belong to the breed of close-ended funds. Again for the MBA pack, close ended funds mean that fixed maturity plans have a definite end date
Being close ended funds, fixed maturity plans offer flexibility to their fund managers and let them plan on their exact investments even at the IPO stage. As a result, even investors can know in advance about the approximate yields they can get by investing in these FMPs at the IPO stage.
This month, UTI Mutual Funds has introduced many FMP Plans! To know more, kindly click here > http://www.utimf.com/Funds/debtfunds/Pages/UTI-FMP-Quarterly-Series-Feb-2012-QFMP-0212-i.aspx
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