I have been investing in HDFC Mid-cap Opportunities and HDFC Balanced Fund in SIP form for the last 12 months, starting from June 2014. I will be eligible to encash them after June 2015. What if I encash them later, say, in December 2015.? Will I get the NAV of June or December?
- D. Praveen
Open end funds such as the ones you have mentioned allow you to redeem your units at any time of your choice. The maturity value of your investment is calculated on the basis of the NAV on the day on which the money is redeemed from the fund. So, the NAV on June 1, 2015 will be applicable if you redeem on that day and the NAV of December 1, 2015 will be considered if that happens to be the date of redemption of your units.
But you have not mentioned why you want to exit these funds? It is inadvisable to invest in equity mutual funds for short periods of time (of less than 3-5 years) as these are long term investment vehicles and should enable investors to build wealth. All of your investments should contribute to your life goals and the money should be redeemed only if one of these is approaching. We have been advising investors to reap the benefits of long term investing and would request you visit the 'Learn' section of our website for more insights.
This article was originally published on January 20, 2015.
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