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Fixed Maturity Plan Funds

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FMP or Fixed Maturity Plans are a type of Close-ended Mutual fund schemes.

These schemes fixed and specific maturity date on which it will be matured.

Proceeds from the maturity will be sent to the bank account or can be transferred to another scheme of the same fund house by submitting an appropirate form.

FMPs can be Equity, Hybrid or Debt schemes.

A majority of mutual fund schemes are of this type only.

In fact, these form the bulk of the NFOs these days.

Fund houses float these schemes because it is easier to get approval for these schemes.

The disadvantage of these schemes is that the expense ratio will be a bit high.

Of course, there will be more disadvantages that come from being a close-ended fund.

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