Frequently Asked Questions 

CAGR (compounded annual growth rate) of your mutual fund investments shows the fund’s average growth or decline over a specific time period.

Extended Internal Rate of Return (XIRR) is a computing technique for determining returns on mutual fund investments at irregular intervals. It can also be described as a fixed rate of return that can be used for all reinvestments and redemptions. You can utilise it to comprehend the current value of all of your investments.

Yes, you can pause an existing SIP by visiting the Summary Holdings and selecting the option of Pause SIP.

The common types of mutual funds include
- Equity funds
- Debt funds
- Hybrid funds
- Liquid funds
 

Mutual funds are an investment option that pools the money of numerous investors to purchase securities such as stocks, bonds, money market instruments, and other types of securities. A team of fund managers then distribute a mutual fund’s assets in order to make money for the fund's shareholders. Common people can invest in broad portfolios of assets like stocks, bonds, and commodities through mutual funds.

Although investing goals vary from person to person - post-retirement costs, money for children's education or marriage, house purchase, etc. - the investment products required to fulfil these goals also vary. Mutual funds have various significant advantages over investing in individual assets. Mutual funds provide a variety of investment options in government securities, corporate bonds, money market instruments, and equity shares, giving ordinary investors a great way to participate in and profit from market uptrends. The primary benefits are the ability to hire a professional manager to make investing decisions and the ability to invest in a wide range of assets for a reasonable price.

A systematic investment plan, or SIP, is an intelligent and simple way to invest in mutual funds. SIP enables you to make recurring, predefined investments of a specified amount. Each time you make an investment; more units of the scheme are added to your account. This allows you to balance out the cost of investment by buying during both falling and rising markets. It also allows you to leverage the power of compounding.

- Helps you diversify risk
- You can easily redeem (liquidate) units of open-ended mutual fund scheme
- Minimum initial investments for most mutual funds make it affordable for you
*Units of close-ended mutual fund schemes can be redeemed only on maturity.
- You will pay lower expense ratio in case of specific mutual funds like ELSS. This is fee charged by mutual fund firms to manage the funds.
- Your funds will be well secure as mutual funds are regulated by the capital markets regulator, Securities and Exchange Board of India (SEBI) under SEBI (Mutual Funds) Regulations, 1996.
- Your investment in ELSS (upto ₹1,50,000) will also qualify for tax benefit upto 46,800/-

KYC is necessary for the following:
- Opening a DEMAT Account
- Enabling Mutual Fund Investments via BSE

Our KYC process is easy and digital. Explore it here

• PAN Card
• Address proof (Aadhar card, Driving License, Voter ID, or passport)

No, if your KYC has already been completed with the central authorities. Please finish setting up your profile and start investing right away.

A SIP works on the basis of periodic and consistent investments, quite like a recurring bank deposit. The investment amount can be auto-debited from your bank account on the basis of standing instructions, and the corresponding amount of mutual fund units are allocated to you. The number of units received depends on the scheme's current Net Asset Value (NAV)

You can start a SIP by selecting the mutual fund of your choice. Once you have selected the fund, you can choose the SIP option in the Fund details page and enter the details of your investment. Start Now

- Rupee cost averaging: You can balance out the cost of investment by buying during both falling and rising markets.
- Power of compounding: You can earn interest earned on the principal, as well as the accumulated interest

With us, you can invest through an SIP on a daily, monthly, quarterly, or half-yearly basis.

Yes, you can cancel an SIP by visiting the Manage Subscriptions section on the App where you will find a list of your active SIPs.

Making a single, large deposit is known as a lump sum investment.

The withdrawal or redeemed amount will be credited to the Primary Bank account which is currently registered in your folio.

You can redeem your mutual fund units by tapping on the Redeem option in the mutual fund of your choice.

The time taken to redeem mutual fund units may vary depending on the fund type and the AMC. Typically, it takes 2-3 working days for the redemption proceeds to be credited to your bank account.

The redemption value is calculated based on the NAV (Net Asset Value) of the mutual fund on the day of redemption, exit load and expense ratio.

 

Yes, you can by specifying the number of units you wish to redeem while placing the redemption request.

The Applicable NAV for redemption continues to be as follows:

• Where the redemption transaction is received on any Business Day at the official points of acceptance of transactions upto 3.00 p.m.
• Where the transaction is received after 3.00 p.m.
• NAV of the same Business Day shall be applicable.
• NAV of the next Business Day.

AutoPay makes SIP payment hassle free and the frequency can be decided by you

AutoPay works by automatically investing a fixed amount of money into a mutual fund on a regular basis, such as monthly or quarterly.

You can set up AutoPay by going to the AutoPay section of your chosen mutual fund. You can then setup your mandate and enter the details of your investment.

1. UPI Payments (Upto INR 1L) through apps (Google Pay, BHIM etc.)
2. Net Banking (Upto INR 10L)
3. NEFT / RTGS
4. Setting up an AutoPay mandate with your bank

Setting up a higher AutoPay limit will allow you to start additional SIPs without redoing the AutoPay process.

For example, only Rs 2,000 will be debited for your SIP even if you set the AutoPay limit of Rs. 25,000. If you start an additional SIP of Rs 3000, then a total amount of 5000 can be debited. You can continue investing in other SIPs up to Rs. 25000.

As per SEBI rules, the use of debit cards or credit cards for purchasing mutual funds is strictly banned.

There is no limit on the number of mandates you can set up. You can set separate AutoPay for separate SIPs. However, for convenience, we recommend that you set a single AutoPay with a high limit and use the same for multiple SIPs.

Usually it takes 3 business working days for the AMC (Asset Management Companies) to allocate units against the payment made.

It generally takes 2-3 working days for a bank to verify and register AutoPay. However, in case you apply for it in-person at a bank then it may take upto 10 days.

If payment is made on weekend or any BSE declared holidays, the amount is deposited or transacted on the next business day.

The SIP installment will be postponed until the bank approves the AutoPay. You can pay the missed installment by using UPI/Net banking to place a one-time lump sum order. Future installments will be processed automatically once the AutoPay is approved.

You cannot edit or modify your ongoing AutoPay mandate. You need to delete it and create a new one.

It usually takes 2-3 working days for an AMC (Asset Management Companies) to allot units for a Mutual Fund Scheme. Even after 3 working days, if you have not received confirmation of units, we request you to contact our Support Team. Click here.(CTA )

In the event of such a scenario, your money will be deposited back in your Bank Account within 3-7 business days. If it has been more than 7 business days and you have not yet received the refund amount, please contact our support team.

A folio number identifies your holdings with the particular mutual fund, which is a special number. This special number, which varies from fund house to fund house, functions similarly to a bank account number. A new Folio is created when you make your first investment in a Scheme of a Fund House, and you will receive information about your Folio Number once the allotment process is complete.

The unit cost of a mutual fund scheme is referred to as NAV, or net asset value. Based on NAV, mutual funds are purchased or sold. The NAV is calculated at the end of each day based on the closing price of all the securities that the respective mutual fund schemes own after making the necessary adjustments, unlike share prices, which fluctuate constantly during trading hours. A mutual fund scheme expenses (TER), which includes fund management, administration, distribution, and other costs, are deducted proportionately from the scheme's assets and are reflected in the NAV of the scheme.

Accelerate SIP is a facility wherein an investor who has enrolled for SIP, has an option to increase the amount of the SIP Installment by a fixed amount at predefined intervals. Thus, this facility enhances the flexibility of the investor to invest higher amounts during the tenure of the SIP. You can accelerate your SIP on this App!

The Systematic Transfer Plan, or STP, is a method of periodic money transfers from one fund to another. The frequency (monthly, weekly, or quarterly) and predetermined amount of the transfer are both up to the investor.

A mutual fund investment plan called the SWP, or systematic withdrawal plan, allows investors to take fixed withdrawals from their investments in any mutual fund scheme at predetermined intervals, such as monthly, quarterly, or yearly.

A mutual fund is a type of financial investment vehicle instrument that pools money from multiple investors to buy a diversified portfolio of stocks, bonds, and other securities.

The Short Term Capital Gain Tax refers to the gains earned from investments made for shorter periods. For taxation purposes, the term ‘short-term’ is defined differently for different types of mutual funds. For example, for debt funds, STCG implies that the investment was held for less than 36 months. On the other hand, for equity funds, any investment held for less than 12 months will come under STCG, if redeemed. As an investor, you can choose to invest in different types of mutual funds, like debt funds, equity funds, and hybrid funds. On holding these investments for less than 12 months (36 months in some cases), the gains from the transfer of these funds will be considered STCG on mutual funds.

Below is the summary of the STCG on the basis of holding period for various types of mutual funds-

Absolute Returns is the most straightforward method to calculate how much gain or loss you have made on your investment. Absolute Return (%) = (Ending Value – Beginning Value) / Beginning Value

CAGR (compounded annual growth) of your mutual fund investments shows the fund’s average annual growth or decline over a specific period.

XIRR (Extended Internal Rate of Return) calculates the CAGR of each installment. CAGR is good for lump sum investments, but where there are different cash investments & withdrawals like in SIPs or SWPs, CAGR is not the right measure. Hence, XIRR calculates the CAGR for each installment and is then added together to give you the overall Compounded Annual Growth Rate.

Investors can feel secure knowing that their money is safe because the Securities and Exchange Board of India (SEBI), Association of Mutual Funds in India (AMFI), and Reserve Bank of India (RBI) closely monitor all mutual fund plans and fund firms.

As Motilal Oswal is a SEBI regulated entity, one has to fulfil the KYC requirements to become investment-ready. KYC is required for the following use cases:

• Create your Motilal Oswal profile in accordance with SEBI guidelines,

• Enables you to invest in Mutual funds via BSE,

• Enables you to invest in US stocks via a regulated US broker.

You will be asked to submit the following documents during your Onboarding process:

• PAN Card,

• Address proof (Aadhar card, Driving License, Voter card, or passport)

No. As per SEBI rules, it is necessary for you to have a PAN Card to invest in mutual funds.