The majority of mutual fund plans are open end plans, which let investors withdraw their entire investment amount at any time.
Only in rare circumstances, as determined by the Board of Trustees, do schemes impose a restriction on redemption.
All Equity Linked Savings Schemes (ELSS) must "lock-in" assets for a minimum of three years in order to qualify for Section 80C tax advantages. Any dividend that these plans declare during this time, nevertheless, is freely available for payout. No other class of schemes has the ability to enforce such a lock-in. To discourage short-term investors from joining a scheme, some may charge an exit-load for early redemptions. Minimum submission quantities may be established by AMCs. The scheme-related materials that an investor should study before investing contain all of this information.
The AMC does not fund or permit any redemption for closed-end schemes prior to the termination/conclusion date due to their fixed tenure. All closed-end funds, however, list their units on the stock exchange, so an investor looking for liquidity must sell units to another buyer at a price set by the market.