Wednesday 26 February 2014

Fixed Maturity Plan - RR Investors!

A Fixed maturity Plan (FMP) is a closed-ended debt scheme for a fixed period of time, wherein the duration of debt papers is aligned with the tenure of the scheme.


Features of FMPs

1- FMPs generally invest in Certificate of deposits (CDs), Commercial Papers (CPs), money market instruments, and corporate bonds.
2- FMPs provide predictable return & are not subject to interest rate risk.
3- On tax adjusted basis, return on FMPs are better than bank FDs, as one year Plus FMPs qualifies LTCG Tax.


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