If you’re looking to invest in mutual funds in India, UTI Mutual Funds is a popular and well-established option. UTI Asset Management Company Limited (UTI AMC) was established in 2003 and is one of the oldest and largest mutual fund companies in India, with a history that goes back to 1963.
In this guide, we’ll take a closer look at UTI Mutual Funds, including their history, types of funds, performance, and other important factors to consider when investing.
History of UTI Mutual Funds
UTI Mutual Funds has a long and storied history in India’s financial sector. The company was initially established in 1963 as Unit Trust of India (UTI), a government-owned entity that offered unit-linked investment plans (ULIPs) to Indian investors.
In the decades that followed, UTI grew rapidly and became one of the most trusted names in Indian mutual funds. However, by the late 1990s, UTI’s growth had slowed, and the company faced financial difficulties due to bad investments and mismanagement.
In 2003, the Indian government restructured UTI into two separate entities: UTI Mutual Fund, which took over the management of the existing UTI schemes, and UTI Asset Management Company Limited (UTI AMC), which became the new company responsible for managing the mutual funds.
Since then, UTI AMC has grown into one of the largest mutual fund companies in India, with over 150 different schemes and assets under management (AUM) of more than Rs. 1.5 lakh crore.
Types of UTI Mutual Funds
UTI Mutual Funds offer a wide range of investment options to suit different risk profiles and investment goals. Some of the most popular types of UTI Mutual Funds include:
- Equity Funds: These funds invest primarily in stocks and are suitable for investors looking for long-term capital appreciation. UTI Equity Fund, UTI Mastershare Fund, and UTI Mid Cap Fund are some of the most popular equity funds offered by UTI.
- Debt Funds: These funds invest primarily in fixed-income securities such as bonds, treasury bills, and corporate debt. They are suitable for investors looking for regular income and lower risk than equity funds. UTI Bond Fund, UTI Dynamic Bond Fund, and UTI Short Term Income Fund are some of the popular debt funds offered by UTI.
- Hybrid Funds: These funds invest in both equity and debt instruments, and are suitable for investors looking for a balanced portfolio. UTI Balanced Fund, UTI Hybrid Equity Fund, and UTI Arbitrage Fund are some of the popular hybrid funds offered by UTI.
- Solution-Oriented Funds: These funds are designed to help investors achieve specific financial goals, such as retirement planning, children’s education, or buying a home. UTI Retirement Benefit Pension Fund and UTI Children’s Career Fund Savings Plan are examples of solution-oriented funds offered by UTI.
Performance of UTI Mutual Funds
Like any mutual fund company, the performance of UTI Mutual Funds varies depending on the specific fund and market conditions. However, UTI has a strong track record of delivering consistent returns over the long term.
For example
UTI Equity Fund has delivered an average annual return of 12.25% over the past five years, while UTI Bond Fund has delivered an average annual return of 7.58% over the same period. UTI Balanced Fund, which invests in both equity and debt instruments, has delivered an average annual return of 10.27% over the past five years.
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Frequently Asked Questions (FAQs)
Q. What is UTI Mutual Funds?
UTI Mutual Funds is a well-established and popular mutual fund company in India, with a history that goes back to 1963. It is managed by UTI Asset Management Company Limited (UTI AMC), which offers a wide range of investment options to suit different risk profiles and investment goals.
Q. How do I invest in UTI Mutual Funds?
You can invest in UTI Mutual Funds through various channels, including online portals, mobile apps, and physical branches. You can also invest through a registered mutual fund distributor or financial advisor.
Q. What types of funds does UTI Mutual Funds offer?
UTI Mutual Funds offer a wide range of investment options, including equity funds, debt funds, hybrid funds, and solution-oriented funds. Some of the most popular funds include UTI Equity Fund, UTI Bond Fund, UTI Balanced Fund, and UTI Retirement Benefit Pension Fund.
Q. What is the minimum investment required to invest in UTI Mutual Funds?
The minimum investment required to invest in UTI Mutual Funds varies depending on the specific fund and the mode of investment. For example, the minimum investment for a lump sum investment may be different than that for a systematic investment plan (SIP).
Q. What is the expense ratio for UTI Mutual Funds?
The expense ratio for UTI Mutual Funds varies depending on the specific fund and the asset under management. However, UTI Mutual Funds’ expense ratios are generally in line with industry standards and are transparently disclosed in the fund’s offer document.
Q. What is the redemption process for UTI Mutual Funds?
You can redeem your UTI Mutual Funds through various channels, including online portals, mobile apps, and physical branches. You can also submit a redemption request through a registered mutual fund distributor or financial advisor. The redemption proceeds are generally credited to your bank account within a few working days.
Q. What is the tax implication of investing in UTI Mutual Funds?
The tax implications of investing in UTI Mutual Funds depend on various factors, including the type of fund, investment tenure, and the investor’s tax bracket. For example, long-term capital gains from equity funds are taxed at 10% if the gains exceed Rs. 1 lakh, while short-term capital gains from equity funds are taxed at 15%. On the other hand, gains from debt funds are taxed as per the investor’s tax bracket.
Q. Is UTI Mutual Funds safe for investment?
UTI Mutual Funds are regulated by the Securities and Exchange Board of India (SEBI) and are subject to strict investment guidelines and disclosure requirements. UTI AMC has a strong track record of delivering consistent returns over the long term and is considered one of the most trusted names in Indian mutual funds. However, like any investment, there is a risk involved, and investors should carefully consider their investment goals and risk appetite before investing in UTI Mutual Funds.
