Sbi mutual fund exit load calculator
- how exit load is calculated in sip
- what is exit load in sip
- exit load charges in sip
- how exit load is calculated
What is exit load in mutual fund with example!
While investing in mutual funds, you may have come across the term ‘exit load’.
How to avoid exit load in sip
You may have been advised to check it before you redeem a fund soon after investing in it. What is this exit load and why does it matter? Let’s understand.
What Is an Exit Load?
The exit load is a fee charged by a mutual fund company when investors redeem or sell their units before a specified period.
The purpose of exit load is to discourage short-term trading and to compensate the fund for potential costs associated with the early redemption of units. By imposing a fee on early redemptions, mutual funds aim to protect long-term investors from the potential adverse effects of short-term trading activities.
Exit load is calculated as a percentage of the value of the units being redeemed and is deducted from the redemption proceeds.
For example, if an exit load of 1% applies and an investor redeems Rs 10,000 worth of units, the fund will deduct Rs 100 as the exit load, and the investor will receive Rs 9,900 as the redemption proceeds.
It’s important to note that not all mutual funds charge e
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