3 Replies to “Mutual Fund Purchase any time and redeem any time?”

  1. Yes, Shrinivas. The answer to your question no. 1 is Yes. You can do so. However, please note that units purchased first will be treated as sold first on First In First Out basis. Further, if you sell equity based funds units within one year of purchase, you will be called upon to pay short term capital gains tax on the gains made @ 15.45% of the gains.

    2. For second question, you cannot sell exactly when NAV is high. The reason is this. Daily NAV is calculated at about 1600 – 1700 hrs after the market closes. This NAV will be valid for sale/purchase the next day upto 1 p.m. So, if you lodge your purchase/sale order ON LINE before 1 p.m., these will be bought/sold at the existing NAV.

    3. Yes. SIP orders can be placed and unless revoked, subject to availability of funds in your account, will be executed. However, for tax saving schemes like ELSS, three years should elapse between date of purchase and date of sale. Therefore what is bought on 1st February 2010 can be sold only after 1st February 2013, bought on 1st March 2010 can be sold only after 1st Malrch 2013 and so on……

    Now, if you have any further queries/doubts, email me or ask [email protected]

  2. You can buy mutual fund any day at low price and sell any day at a higher price.
    But the catch is, if you sell within one year, tax will be deducted form your earnings. This is called short term capital gain tax. If you fall under 20% tax bracket, then 20% will be deducted form your earnings.

    Mutual Fund SIP’s are great when it comes to planning savings and investment. Every month a predefined money is drawn by the mutual fund company and buy’s mutual fund units for you. Just remember that all mutual fund doest not give tax advantage. If you want to invest to get some tax benefits, make it clear before you buy the units.

  3. you can trade like stocks with mf schemes online through ur broker but presently the liquidity is not there so wait for some time
    The tranx cost would be high as compare to investment through mf advisor (physical) because from 1 st auguest 2009 there is no entry load to investor
    ur second Q ans is every tax saver funds has lock-in period of 3 yrs from date of investment

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