Scheme | Corpus | Nav | |||
| Reliance - MIP (G) | 4190.43 | 20.48 | 14.74 | 19.12 | 14.43 |
| Birla SL - MIP II Savings 5 Plan (G) | 1819.05 | 16.65 | 6.53 | 13.05 | 12.04 |
| HDFC - MIP LTP (G) | 5469.1 | 21.44 | 15.15 | 15.09 | 11.95 |
| L&T - MIP Reg Cum Plan | 31.16 | 18.87 | 7.64 | 5.16 | 11.92 |
| CAN - Robeco MIP (G) | 214.13 | 27.92 | 8.81 | 13.29 | 11.74 |
What is a Monthly Income Plan (MIP) mutual fund?
Primarily, MIP of mutual fund is a debt-oriented scheme that generally invests up to 75-80 % of its corpus in debt instruments and the remaining in equity instruments.
Return: MIPs aim to provide steady returns with limited volatility. In the past 3 years, most MIPs have provided average returns in the range of 12-13%.
Tenure: MIPs are ideal for investment horizon of 2-3 years.
Taxability: MIPs being debt mutual funds, a dividend distribution tax (DDT) of 12.867 % is levied.
If you sell the fund units before a year and there is a gain, short-term capital gains (STCG) tax is applicable - the net gain will be added to current taxable income and tax will be levied as per your personal income tax slab. If you sell units after a year and there is a gain, a long-term capital gains (LTCG) tax is applicable - 10 % tax will be levied (without indexation benefit) or 20 %tax with indexation benefit, whichever is lower.
Who should invest?
Conservative investors who are looking for better returns than bank FDs, mutual fund MIP could be a good option. Although monthly returns cannot be guaranteed, one can bank on them for a steady income.
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