Tata Mutual Fund launches two fixed maturity plans with 91 and 364 days tenure: Should you invest?

It falls under the category of a close-ended debt scheme, offering relatively low-interest rate risk and moderate credit risk.

The scheme has a minimum subscription amount of ₹5,000 and subsequent multiples of ₹1.

The NAVs will be calculated and disclosed within 5 business days from the allotment date.

The scheme provides various investment options, including Growth and Income Distribution cum capital withdrawal option (IDCW) under both Regular and Direct Plans, Tata Mutual Fund said.

Tata Fixed Maturity Plan Series 61 Scheme B (364 days) shares a similar objective, aiming to generate income and/or capital appreciation through investments in fixed-income instruments with maturities aligned with the scheme's tenure.

As a close-ended debt scheme, it also presents relatively low-interest rate risk and moderate credit risk.

The scheme maintains a minimum subscription amount of ₹5,000 and subsequent multiples of ₹1.

Like scheme A, NAVs will be disclosed within five business days from the allotment date.

Investors can choose between Growth and Income Distribution cum capital withdrawal option (IDCW) under both Regular and Direct Plans.

FMPs offer an opportunity for conservative investors seeking stable returns with a shorter investment horizon.

The low interest rate risk and moderate credit risk make it suitable for risk-averse individuals.

However, FMPs are close-ended funds with a fixed maturity period, and exit before maturity may result in liquidity challenges. If an investor requires flexibility and liquidity, other investment options like open-ended funds might be more suitable, experts say.

Investors should carefully consider their financial goals and risk tolerance before making any investment decisions.