In a Systematic Withdrawal Plan (SWP), the number of mutual fund units redeemed in each withdrawal depends on:
- Withdrawal Amount – The fixed amount you choose to withdraw regularly.
- Net Asset Value (NAV) on Withdrawal Date – The NAV applicable on the withdrawal day determines how many units are redeemed.
- Exit Load (if applicable) – Some mutual funds charge an exit load if withdrawals are made within a specific time frame. If an exit load applies, it affects the final credited amount.
Formula for Calculating SWP Redemption Units:
Units Redeemed = Withdrawal Amount ÷ Applicable NAV
For example:
-
If you set up an SWP for ₹10,000 per month and the NAV on the withdrawal date is ₹50, the units redeemed will be:
10,000 ÷ 50 = 200 units
-
If the NAV fluctuates to ₹55 in the next month, the number of units redeemed will be:
10,000 ÷ 55 = 181.81 units
Since NAV varies daily, the number of units deducted for each SWP withdrawal will also change accordingly.
In a Systematic Withdrawal Plan (SWP), the number of mutual fund units redeemed in each withdrawal depends on:
- Withdrawal Amount – The fixed amount you choose to withdraw regularly.
- Net Asset Value (NAV) on Withdrawal Date – The NAV applicable on the withdrawal day determines how many units are redeemed.
- Exit Load (if applicable) – Some mutual funds charge an exit load if withdrawals are made within a specific time frame. If an exit load applies, it affects the final credited amount.
Formula for Calculating SWP Redemption Units:
Units Redeemed = Withdrawal Amount ÷ Applicable NAV
For example:
-
If you set up an SWP for ₹10,000 per month and the NAV on the withdrawal date is ₹50, the units redeemed will be:
10,000 ÷ 50 = 200 units
-
If the NAV fluctuates to ₹55 in the next month, the number of units redeemed will be:
10,000 ÷ 55 = 181.81 units
Since NAV varies daily, the number of units deducted for each SWP withdrawal will also change accordingly.
