view original postTarget Maturity Funds see surge in assets as investor traffic multiplies
Jash Kriplani
32 minutes ago
Target Maturity Funds have grown significantly over the last few years after Government-led Bharat Bond ETFs were launched by Edelweiss Mutual Fund. Apart from ETFs, now there are also several index target maturity funds. While target maturity funds have a fixed maturity date, which is when the scheme and its portfolio investments mature, investors can easily make pre-mature withdrawal as these are open-end funds. However, it is advisable to stick till the maturity of the fund, to get returns closer to the fund’s yield to maturity. As interest rates rise, investors can use such funds to lock-in their investments at higher yields.
Target Maturity Funds have grown significantly over the last few years after Government-led Bharat Bond ETFs were launched by Edelweiss Mutual Fund. Apart from ETFs, now there are also several index target maturity funds. While target maturity funds have a fixed maturity date, which is when the scheme and its portfolio investments mature, investors can easily make pre-mature withdrawal as these are open-end funds. However, it is advisable to stick till the maturity of the fund, to get returns closer to the fund’s yield to maturity. As interest rates rise, investors can use such funds to lock-in their investments at higher yields.
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Investor flows have shifted towards passively-managed target maturity funds from active funds. Industry executives say that actively-managed funds have found it challenging to deliver inflation-adjusted returns in recent times, and post-Franklin Templeton crisis, there have been concerns on the credit quality of the portfolios.
Investor flows have shifted towards passively-managed target maturity funds from active funds. Industry executives say that actively-managed funds have found it challenging to deliver inflation-adjusted returns in recent times, and post-Franklin Templeton crisis, there have been concerns on the credit quality of the portfolios.
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Mutual funds have launched more index-based target maturity funds, as all ETFs don’t have enough liquidity on the stock exchanges and there can be wider deviations in the executed price and the intraday NAV (INAV) of the ETF.
Mutual funds have launched more index-based target maturity funds, as all ETFs don’t have enough liquidity on the stock exchanges and there can be wider deviations in the executed price and the intraday NAV (INAV) of the ETF.
Microsoft and partners may be compensated if you purchase something through recommended links in this article.
Microsoft and partners may be compensated if you purchase something through recommended links in this article.
Microsoft and partners may be compensated if you purchase something through recommended links in this article.
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