What is Long Term Mutual Fund
Long Term Mutual Fund are those that make five-year or longer loans to reputable businesses. Due to the loan’s duration, the investment is intrinsically riskier than other debt funds since it is more or less exposed to the full economic cycle.
Advantages of Long Term Mutual Fund
- Appropriate when economic interest rates are anticipated to decline or remain steady for a lengthy period of time
- These strategies have a higher risk than bank fixed deposits of comparable length, but they often offer returns that are almost comparable. The indexation benefit that occurs if you stay invested for at least three years makes these strategies more tax-efficient.
Which are the best Long Term Mutual Fund to invest in 2023?
|Fund Name||5 Year Return (Annualized)|
|ICICI Prudential Long Term Bond Fund||7.03 % p.a.|
|Aditya Birla Sun Life Long Duration Fund||5.7%|
|Axis Long Duration Fund||10.36%|
|HDFC Long Duration Debt Fund||17.41%.|
|Nippon India Nivesh Lakshya Fund||5.25%|
How to invest in Long Term Mutual Fund?
It is quite easy to invest in Long Duration mutual funds. Here are the steps that you have to follow.
Register online on app or website which provide mutual fund services
- The Long Duration fund you want to invest in may be found under Mutual Funds.
- The amount and form of investment may be selected by clicking invest (SIP or Lumpsum)
- Complete your investment by providing your KYC information (bank details, pan number).
How long should I stay invested in Long Duration Mutual Funds?
You should invest in long-duration funds for at least five years since, well, long-duration funds lend for lengthy duration.
Where do Long Duration Mutual Funds invest?
For a long time The normal loan term is five years or longer. The types of borrowers they are allowed to lend to are not restricted. Yet, the majority of the funds in this category lend to high calibre borrowers.
Are Long Duration Mutual Funds high risk?
These funds are intrinsically riskier than other Debt Funds because of the length of the loans they have, which implies that investments are more or less exposed to the full economic cycle.
What kind of returns can i earn from Long Duration ?
For a long time Over the past year, funds have produced returns averaging 3.97% per annum. Their three and five year annualised returns are respectively 3.56% and 7.03% p.a.