Key risks to evaluate before opting for Loan Against Mutual Funds

Understanding risks like market volatility and margin calls is essential before taking a Loan Against Mutual Funds.

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Key risks to evaluate before opting for Loan Against Mutual Funds

1 min read57 words
Key risks to evaluate before opting for Loan Against Mutual Funds
Understanding risks like market volatility and margin calls is essential before taking a Loan Against Mutual Funds.
While Loan Against Mutual Funds offers flexibility, investors must understand associated risks. Market volatility can reduce the value of pledged units, leading to margin calls. Failure to maintain required collateral levels may result in forced redemption. Evaluating repayment discipline, interest costs, and market conditions is essential before borrowing. Responsible usage ensures benefits outweigh risks. Apply Now
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