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  • What are Mutual Funds?

    Mutual Funds are investment schemes professionally managed by financial experts. Many investors, individuals and entities, invest money in these schemes or funds to generate better returns. These investment schemes could invest in Shares / Stocks(Equity), Government and Corporate Bonds / Securities / Debentures(Fixed Income) or a mixture of the Equity and Fixed Income Securities. Mutual Funds are bought and sold in Units.Mutual Fund units are allocated to investors basis the proportion of their investments and value of these units is tracked as Net Asset Value(NAV) which is daily released by the Fund houses.The Securities and Exchange Board Of India(SEBI) regulates the Mutual Funds industry, and there are around 45 different Mutual Fund houses and more than 12000+ Mutual Fund Schemes.

  • Is there any tax on Mutual Funds?

    Long term Capital gains tax (if held for more than a year) for equity mutual funds are taxed at 10% for gains withdrawn exceeding ₹1 lakh in a financial year.

    Gains withdrawn up to ₹1 lakh in a financial year are exempt from Tax.

    Short Term Capital gains tax (if held for less than a year) on equity mutual funds investments is 15%.

    Ocean Finvest would provide you Capital gains statement to assist you in your tax computation.

  • What is a lock-in period? Is there a lock in period for my investments?

    Lock in period is the time during which an investor can not withdraw/redeem his/her investments. Some mutual fund schemes like ELSS/Tax saving funds come with a lock-in period of 3 years as mandated by the government. This essentially means that the investments cannot be redeemed before a period of 3 years from the date of investment in any circumstances. At upwardly, apart from the ELSS/Tax Saving Funds, we do not distribute any funds with lock-in period. In a fund with no lock in period, you can redeem or withdraw your investment at any point in time. Once you redeem these funds, the money would be credited back to your bank account within 1-3 days.

  • What is exit load? How to avoid exit load for my investments?

    Some Mutual fund schemes have an exit load, and some schemes don’t. The schemes which have an exit load will incur a small charge if they redeem/withdraw their investments before the stipulated time. For example, a mutual fund scheme with an exit load of 0.25% for 3 months, will incur a charge of 0.25% if the investment is withdrawn before 3 months of investment. Please note that the same fund will not incur any charges if the investment is withdrawn/redeemed after a period of 3 months. Ocean Finvest recommends an investment into funds and rebalancing taking into account the exit loads and your investment horizon. So for example, if you want to invest for 6 months, upwardly would suggest a fund which does not have any exit load after 6 months. The exit loads of these funds are mentioned on our website. Ocean Finvest would also calculate the exit load applicable to you once you are redeeming/selling the fund.

  • What are various mutual fund scheme options like growth option, dividend option?

    Mutual Fund schemes are available in growth and dividend option. Within the dividend option, payout or reinvestment options are available. In the growth option of Mutual fund schemes, profits made by the scheme are invested back into it. This results in the net asset value (NAV) of the scheme rising over time. When the scheme gains, the NAV rises, and in the case of a loss, it goes down. The only option to realise the profit in the growth option is to sell or redeem your investments. The dividend option can re-invest (dividend reinvestment option) or pay out the dividends (dividend payout option) the profits made by the fund. Profits or dividends are distributed to the investor from time to time depending on the profits made. Dividends are declared only when the scheme makes a profit, and it is at the discretion of the fund manager. The dividend is paid from the NAV of the unit. Ocean Finvest advises the right investment strategy for you based on your investment horizon and tax implications.

  • What are open ended, closed ended and interval funds?

    Open-ended funds are those which can be purchased and sold anytime. Closed-ended funds can be purchased from the fund house only at the time of the new fund offering (NFO) and can be sold only once the period of the closed-ended fund has ended. Interval funds have periodic intervals specified by the funds when they can be purchased and sold. Ocean Finvest only distributes open-ended funds to its customers. Please note that even though the fund may be an open-ended fund the exit loads, if any, would be applicable.

  • Are returns guaranteed on Mutual Funds?

    Mutual funds are market linked instruments. They invest in stocks, fixed income securities, arbitrage opportunities deemed fit by the Fund manager who is a financial expert. These market linked securities can go up or down in value as per the various macro and micro economic conditions. There is no guarantee of return on Mutual funds. The mutual fund returns can vary from past returns as well. We create balanced and personalised portfolios for you based on your Investment Horizon and Risk Profiles while accounting for the prevailing Market Conditions like Stock Markets performance ( Price to Earning, Price to Book, Dividend Yield), Interest Rates, GDP growth Rates and other important macroeconomic factors. We optimise your portfolio to offer maximum possible expected return for a given level of risk through careful selection of asset classes and mutual funds using our proprietary ranking frameworks.

  • Why are mutual fund investments better than other investment products?

    Mutual Funds, historically, have proven to be much better investment avenues than other products available to investors. Investments in MF have proven to be more effective because of the following reasons:

    Managed by professionals: Financial experts invest in equity and fixed income products invest on your behalf.They are supported by large teams which assist them in analyzing data and dissecting nitty gritty of the markets(macro and micro economic environment, GDP rates, Interest rates and its future outlook, fundamental analysis into each company that they invest or not invest in) which clients as individuals might not be able to do themselves.

    Better taxation structures: The government of India offers incentives to customers to invest in mutual funds by providing tax structures. So while your fixed deposit returns are completely taxable, Investment in debt mutual funds come with tax indexation benefits (which can lower your taxation burden to almost as low as 2% as opposed to as high as 30% in Fixed deposits). Investments in equity mutual funds have only 10% tax (on gains withdrawn above ₹1 lakh in an year) compared to 30% taxation on FDs. Gains on equity mutual funds withdrawn up to ₹1 lakh in an year are exempt from tax.

    Better Flexibility: Mutual funds are held in units. So you can always redeem your investment partially while keeping the other investment intact and untouched. This is unlike fixed deposits where you have to fully withdraw your investment and pay pre-mature withdrawal charges on the entire amount.

    Better liquidity: Open ended mutual funds can be sold anytime. This is unlike investment like Insurance, PPF, NSC, etc. where you have long lock-in periods and large pre-mature withdrawal penalties.

    Better Diversification: Mutual funds invest in multiple securities. This diversifies the risk for you much better than other investments.


Watch these videos for a crash course on Mutual Funds