NSC/ FD VS Equity MF Comparison table

A self explanatory table of comparison between investments

( Fixed Deposit/ National Savings Certificate Vs Diversified Mutual Fund)

Amount in Rs
InvestmentF.D./ NSCDiversified Equity MF
Period6 years6 years
Maturity Value15868.7429859.84
Tax on Income/ Capital gains 1573.680
Value of Investment after 5 Years10109.8725674.65
(post tax post inflation)
Difference (15564.78)
RatesPer annum
Inflation 6%
Rate of Interest on F.D./NSC8%
Rate of Return on MF 20%***(Last five years average 40%)
Income Tax rate30%

***This post was published originally in Dec 2006 ( When the global equities were moving to a  peak ). In those times,an average equity mutual fund had annualized returns over 40% for five years ( 2001-2006). In 2013, the average annualized return for equity funds stand at around 5 % (considering the last five year period 2008-13).

So, Please know your facts and risks associated well before investing. Blind extrapolation of the past would lead to great failures.


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