Balanced fund for Non Resident Indians
Features of balanced fund:-
Allocation of assets:
This constitutes the basic nature of balanced fund. As definition of balanced fund goes, this feature actually specifies the percentage of investment made in equities and percentage in debt securities. Most of the mutual funds present in market today invest 60% of their investment in equities and stock market and 40% in debt securities.
Deviation in allocation:
This factor defines what the percentage of risk associated with the particular investment type is. Higher the value of deviation in asset value higher will be the probability of gain or loss and hence higher risk on an investment.
Diversification in investment:
The mutual fund provider has a range of options for investment in both equities and debt securities. This diversification options depend on core investment objectives. For ex: one mutual fund mentions that it sells a particular holding when expected gain is reached or there is no probability of reaching expected target. It is important for an investor to know what strategy a particular mutual fund chooses for investment. Commercial papers, certificate of deposit, treasury bills, stock of agricultural products, government securities are all few investment options in balanced fund.
Entry load, exit load and other charges:
There are set of charges a mutual fund may impose on the investor in order to process the investment and maintain the corpus. These are charged in the form of entry load, exit load etc. Usually these loads constitute a percentage of amounts of units.
- An NRI should hold NRO or NRE or FCNR type of account.
- All investments in mutual funds can be made only in Indian Rupees.
- Redemption amount will reach them in the form of cheque through post.
- TDS is applicable on redemption amounts; there are tax benefits that they can avail according to IT act.