The Unit holders of the Source scheme(s) have to set triggers based on the predetermined event. On occurrence of predetermined events i.e. the trigger date on which the closing value of Index (for example - S&P BSE SENSEX) reaches or crosses the Index level(s) as indicated by the Unit holder(s) in the enrolment form, the AMC on behalf of the Unit holders will automatically transfer the specified percentage of the amount registered in the Source scheme(s) to select Target scheme(s) on the trigger date(s). Till the time the Triggers indicated by the investors remain inactive, the amount will remain parked in the source scheme.
Usually TRIP Facility is offered in the following 2 options
1. Flexible Installment option: Minimum percentage to be indicated against each index level trigger is 10% and in multiples of 1% thereafter
2. Fixed Installment option: The percentage indicated against each index level trigger is fixed at 25%
How does the facility work?
Suppose you prefer to invest in a mutual fund when markets are at specific levels, you would need to keep track of markets and invest on the day markets reach their desired level. With the TRIP facility, you need not keep track of market movements. You can simply set four trigger levels to switch the desired sum to the select equity scheme. Till the time the investments are triggered into select equity scheme, your investment (will remain parked in select debt scheme) earns interest income.
Example: An investor may choose to invest 15% when Sensex closes below 26,000 levels on a particular day, 20% when it touches 25,500 levels and so on. The investor has invested say Rs 1 lakh in the Liquid Fund (Source Scheme) and has registered for the TRIP facility. As such, if on a specific day in the future, Sensex closes at 25,789 levels, Rs 15000 (15% of 1 lakh) will be transferred preferred equity scheme. (Target Scheme)
MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.