Mutual fund redemption is the method by which an investor can withdraw the money deposited in mutual fund whenever he wants, friends, in today’s topic, we will know what is Mutual fund redemption, and what is the process of Mutual fund redeem.
What is MUTUAL FUND REDEMPTION?
Friends, if your money is deposited in mutual funds, then whenever you feel that you need the money deposited in your mutual funds, then you need to sell your mutual funds, in such cases The process of selling mutual funds in India is called mutual fund redemption,
You can also call Mutual Fund redemption as selling mutual fund unit,
PROCESS OF MUTUAL FUND REDEMPTION- METHODS
Mutual funds can be redeemed in two ways, first – offline, and second online, let us now know about these two methods in some detail,
OFFLINE MUTUAL FUND REDEMPTION
To redeem a Mutual Fund offline, the Unit Holder (Investor) has to fill the Redemption Request form and submit the form to the Mutual Fund company’s office, after putting necessary signatures on it.
Things to keep in mind in offline mutual fund redemption –
- You get the application form from the company’s office, or download it from its website and print it out and fill it up.
- On the mutual fund redemption form, you have to fill some necessary details, such as – name of the unit holder, folio number, name of the scheme and details of the mutual fund plan, as well as you also have to tell how many units of the mutual fund you want to
- buy. want to redeem, or how many rupees do you want to redeem,
In this way, when you fill the mutual fund redemption form and submit it to the mutual fund’s office (AMC or Registar office), then as soon as the mutual fund company approves your application, then the mutual fund will be transferred to the first unit holder’s account. fund redeem money is deposited, - When your application is approved, money is deposited in your account within three days.
ONLINE MUTUAL FUND REDEMPTION
In today’s era of internet and mobile banking, most of the mutual fund companies give the option to buy and sell (redeem) their mutual fund schemes online.
Therefore, even sitting at home, with the help of internet, the mutual fund you want to buy or sell (redeem), you will have to fill the online mutual fund redemption form by visiting the scheme website of that mutual fund company.
Some steps of online mutual fund redemption
- You have to open the “online redemption” or “online transaction” page on the website of the mutual fund company,
- You have to log in with Mutual Fund Folio, or PAN number, or fill up the form given online and submit it,
- Confirmation of successful submission of your form will come on your email or mobile.
- And as soon as your application is approved, the mutual fund company will deposit your money in your account.
Things to keep in mind before MUTUAL FUND REDEMPTION,
- REASONS FOR MUTUAL FUND REDEMPTION
In mutual fund redemption, the first thing you should keep in mind is why you want to redeem that mutual fund?
You can have many reasons for redeeming mutual funds, some reasons may be true and some reasons may be just emotional decisions.
Therefore, when you think of selling or redeeming mutual funds, keep in mind that your reason should not be emotional.
Like – the market is not doing well, and the value of your mutual fund is decreasing,
You should keep in mind that mutual funds are managed by professionals and experienced people of the stock market, and stock market prices fluctuate in the short term,
That’s why you need to stay in the market in such a time,
- CURRENT NAV OF MUTUAL FUND
Once you think that – you have to actually redeem the mutual fund, you should keep in mind that your mutual fund is redeemed or sold only at the current NAV price, and the NAV price keeps changing daily, so At the time of mutual fund redemption, keep in mind the CURRENT NAV, it is very important,
- MUTUAL FUNDS WITH LOCK IN PERIOD
Whenever you think of redeeming mutual funds, keep in mind that what is the lock-in period of your mutual fund,
LOCK IN PERIOD means that for at least how many days you have to deposit money in that mutual fund,
Like – CLOSE ENDED FUND has a LOCK IN period of a certain time, whereas OPEN ENDED FUND can be redeemed anytime,
And Equity Linked Savings Scheme (ELSS) fund cannot be redeemed before 3 years,
- MUTUAL FUND EXIT CHARGES AND TAXES
Whenever you want to REDEEM a mutual fund, before that keep in mind the fee charged for redeeming that fund, this fee is also called EXIT FEE, or EXIT LOAD, and at the same time EXIT It is also important to keep in mind the TAXES involved,
Friends,
I HOPE you would have got a lot of help in understanding MUTUAL FUND REDEMPTION from this article,