Mirae Asset Mutual Fund Changes Exit Load Rules for Hybrid Schemes from January 2025
Mirae Asset Mutual Fund has announced changes to the exit load for its hybrid schemes. These changes will start on January 1, 2025, and will apply to three schemes: Mirae Asset Balanced Advantage Fund, Mirae Asset Multi Asset Allocation Fund, and Mirae Asset Equity Savings Fund.
Under the new structure, the Mirae Asset Balanced Advantage Fund will levy a 1% exit load for units redeemed within 180 days if the redemption exceeds 15% of the total investment. This has reduced the earlier holding period of 365 days.
Similarly, for the Mirae Asset Multi Asset Allocation Fund, this is what applies: for redeeming in excess of 15% of the investments made in less than 180 days, an exit load at the rate of 1% shall apply to such redemption.
The exit load for the Mirae Asset Equity Savings Fund has also been overhauled. An exit load of 1% will be levied where redemptions are more than 15% of the investment and those transactions are done within 90 days. This charge on redemption has replaced the exit load condition that earlier applied to redemptions during 365 days.
The new load structure of the exit is geared to promote longer holding periods in the hybrid schemes on the part of investors. Altered redemption rules that tend to change investor behaviour for stability and less exit by investors on short-term perspectives are expected.
Hybrid funds give a balanced approach to investors by combining various asset classes, like equities, debt instruments, and, in some cases, commodities or real estate. These funds seek to provide a favourable risk-reward balance by combining the growth potential of equities with the stability offered by debt investments.
The revised policies of exit load are an effort to align investor behaviour with the objectives of long-term investment of these hybrid schemes.
