IDCW in mutual fund

[anuragmukherjee28]

IDCW stands for Income Distribution cum Capital Withdrawal. It is a type of mutual fund option that allows investors to receive regular payouts from the fund's income and capital gains. This is in contrast to the growth option, where all income and capital gains are reinvested, leading to a higher NAV over a period of time.

Here are some of the key features/Pros of IDCW mutual funds:

• Regular payouts: Investors receive regular payouts from the fund's income and capital gains. This can provide a steady stream of income
• Capital appreciation: IDCW funds can also provide capital appreciation over time. This is because the fund manager may invest a portion of the payouts in growth-oriented assets.
• Tax efficiency: IDCW funds are generally more tax-efficient than growth funds.

Cons of IDCW :

• May not be suitable for long-term growth
• Have higher fees than growth funds
• More volatile than growth funds