Index investments make target maturity funds more transparent: Experts

With the end of the financial year approaching, fund houses are launching fixed maturity plans (FMPs). New fund offers (NFOs) of FMPs from SBI Mutual Fund and IDFC Mutual Fund are on at present. In addition, HSBC Mutual Fund’s NFO for a target maturity fund (TMF) is also underway.

A large number of TMFs catering to different investment horizons already exist. FMPs and TMFs have many similarities.

“In both, investors have clarity on when they will get their money back. By holding till maturity, they can cancel out interim volatility in a rising interest rate scenario. They can