11% almost guaranteed return - July FMPs

Fixed Maturity Plans (FMP) are similar to Fixed Deposits of Banks with an indicative return usually higher than FDs. As inflation is going through the roof, FMPs are fast catching up in their returns (call it interest/gain in FD term). These FMPs are usually floated by Mutual Fund companies and usually close ended and remains open for investment for a couple of days to couple of weeks. These are usually much more tax efficient than FDs for higher tax bracket individuals. It's slightly riskier than FDs, but usually fund manager could return the indicative returns. For dividend option the tax outfo will be at around 14.6% DDT and for growth option it'll be either 11.2% or 22.4% with indexation benefits (Long Term Capital Gain). So for people with higher tax bracket where FD interest gets taxed at 34%, this is a better bet. Click on following table to see the latest FMP yields. 11% almost guaranteed return - great isn't it?