WHAT IS A MUTUAL FUND?
A Mutual Fund is a professionally managed pool of money from like-minded investors. It invests the money in a diversified portfolio of securities, through various schemes that address the needs of investors. The securities a mutual fund invests in are selected based on the investment objective of each fund as stated in its Offering Document.
The Fund adds value through two primary channels: income earned and any capital appreciation realized through sale. Both are shared by unit holders in proportion to the number of units they own.
DO YOU OFFER SHARIAH COMPLIANT MUTUAL FUNDS?
Yes — we offer Shariah Compliant investment options across our mutual fund categories.
WHY INVEST IN A MUTUAL FUND?
- Professional management of your savings
- Better returns than standard investment avenues
- Diversification
- Liquidity
- One-window operation
- Regular income stream
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- Highly regulated
- Transparency
- Varied choice of funds
WHAT ARE OPEN / CLOSE-ENDED MUTUAL FUNDS?
Open-ended Fund: Available for subscription throughout the year. Investors can conveniently buy and sell units of the funds from the Asset Management Company (AMC) at the related prices commonly known as Net Asset Value (NAV).
Close-ended Fund: Open for subscription only during a specified period. Investors can invest in the scheme at the time of the initial public issue and thereafter buy or sell the units of the scheme on the Stock Exchanges where they are listed.
WHAT ARE THE CATEGORIES OF MUTUAL FUNDS OFFERED BY NITL?
NITL manages open-ended schemes categorized into the following investment objectives. All the schemes can be managed conventionally or as Shariah-compliant portfolios depending on investor preference.
WHAT IS THE DIFFERENCE BETWEEN GROWTH UNITS AND INCOME UNITS?
The basic difference is in the manner in which investment in the units of a Fund is redeemed.
- Growth unit: the investment remains in the Fund until the investor redeems part or whole of the investment.
- Income unit: the investor opts to withdraw a certain amount at regular intervals. Income units have two types:
- Fixed Income Unit: the investor specifies a fixed amount to be redeemed and transferred to bank account at regular intervals. (If redemptions exceed returns, principal may deplete.)
- Flexible Income Unit: the investor authorizes the Management Company to redeem and transfer an amount equal to the increase in the investment value during each interval.
Income funds provide a consistent return stream and withdrawals generally settle in 2–3 business days.
Income funds provide a better and consistent return stream to all investors regardless of the length of investment time period whereas bank returns may not even cover for inflation.
Investment in Income Funds can be withdrawn at any time without any penalty. The money is transferred in your designated bank account generally in 2-3 days.
Capital gain arising from disposal/redemption of securities (including Mutual Funds) shall be chargeable to tax at the rates specified in Division VII of Part I of the First Schedule of the Income Tax Ordinance, 2001. For specific cases (non-filers, holding periods, etc.) consult the law or your tax advisor.
| Investor Category | Stock Fund* | Other Funds |
|---|---|---|
| Individual & AOP | 15% | 15% |
| Company (other than Insurance & Banks) | 15% | 25% |
For Stock Fund: Tax will be withheld @ 15% if dividend receipts are less than capital gains. No capital gains tax shall be deducted, if the holding period of the security is more than six years. For Non-filers, units acquired before July 01, 2025, the withholding on capital gains will be doubled. Please refer First Schedule of the Income Tax Ordinance, 2001 for comprehensive understanding.
WHAT IS THE APPLICABLE TAX ON DIVIDEND?
At present, Tax rate on dividends received from Mutual Funds deriving fifty percent or more income from profit on debt will be withheld @ 25%. Please refer First Schedule of the Income Tax Ordinance, 2001 for comprehensive understanding.
WHAT ARE THE BENCHMARK FOR FUNDS BEING MANAGED BY NITL?
NITL Funds uses a wide variety of market representative benchmarks to judge the performance of its Funds. For information on the specific benchmarks used for each fund, please see the individual fund’s product page.
IS THERE ANY PURCHASE FEE (FRONT-END SALES LOAD) ON FUNDS BEING MANAGED BY NITL?
No, NITL Funds does not charge any Front-End Load on its products.
IS THERE ANY ENCASHMENT/WITHDRAWAL FEE (BACK-END LOAD) ON FUNDS BEING MANAGED BY NITL?
No, NITL Funds does not charge any Back-End Load on its products.