Target Maturity Fund
Also written TMF · Target Maturity Fund (TMF)
A debt fund designed to mature on a specific date, typically between 2 and 14 years, investing in bonds of matching maturity so as to minimise reinvestment risk, and listed to permit exit before maturity.
This one is not written up yet
The definition above is the short version. A full explanation — how it works, a worked example and the exam traps — is still being written. In the meantime the chapter below covers it in context.
Written up from the same chapter
- Assets under ManagementThe total value of the money a scheme or a fund house manages — the current NAV multiplied by units outstanding — and the base on which the expense ratio is charged.
- Exchange Traded FundA mutual fund scheme whose units are listed and traded on a stock exchange like a share, so you transact at live prices through the day instead of at one end-of-day NAV.
- Face valueThe denomination a company's capital is divided into and carried in its books — fixed, printed on the certificate, and the base on which dividend percentages and stock splits are computed.
- Fixed Maturity PlanA close-ended debt scheme whose portfolio maturity is aligned to the scheme's own maturity date, so the investor who stays to the end has a reasonably visible outcome — though never a guaranteed one.
- Fund of fundsAn AIF that invests in the units of other AIFs rather than directly in investee companies — buying diversification across managers and strategies, and paying two layers of fees for it.
- IDCWThe renamed dividend option of a mutual fund scheme — a payout that is part income and part return of your own capital, which is why the NAV falls by exactly the amount distributed.
Where this is taught
- Series V-D · Chapter 2: Concept & Role of a Mutual Fundintroduced here
- Series X-A · Chapter 11: Mutual Fundintroduced here
- Series V-B · Chapter 2: Concept and Role of a mutual fundintroduced here
- Series V-A · Chapter 2: Concept & Role of a Mutual Fundintroduced here
- Series V-B · Chapter 4: Mutual fund products for the new cadre of distributors
- Series V-D · Chapter 12: Mutual Fund Scheme Selection
- Series V-A · Chapter 12: Mutual Fund Scheme Selection
Related terms
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