I came across a fund named ICICI Interval Fund, the AMC mentions that it is an income fund for 370 days. What exactly do you mean by an Interval Fund? Also what are the implications of investing in this fund?
- Naresh
An Interval Fund by design is a mix of both an open-ended and closed-ended fund. Such funds allow you to subscribe or sell the units only during pre-decided time periods. The ICICI Interval Fund, to be specific, opens for subscriptions and redemptions in every 370 days. So there exists a limited exit opportunity.
As it is an income fund, if you continue to hold and carry on the complete investment for three years, it will be taxed at a concessional rate and treated as a long-term capital gain. And if you withdraw your investments anytime before three years, it will be treated as short-term capital gain and the gains would be added to your income.
This article was originally published on March 13, 2019.
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