NFO : Motilal Oswal MOSt Shares M50 ETF (MOSt Shares M50) Review

Objective of Scheme :

The Scheme seeks investment return that corresponds (before fees and expenses) generally to the performance of the MOSt 50 Basket (Underlying Basket), subject to tracking error.

Scheme Type Open Ended

Scheme Category Other ETFs

New Fund Launch Date 30-Jun-2010

Closure Date 19-Jul-2010
Offer Closure Date 19-Jul-2010 Offer Price (Rs.) Rs. 10 + premium

Minimum Subscription Amount : Rs. 10,000/- and in multiples of Re. 1/- thereof

For Further Details Please Visit Website : www.motilaloswal.com/assetmanagement/

CAMS launches eNFO service to support online submission of NFO applications

cams%20logo The facility will enable fund applicants to submit applications within time in an easy and hassle-free manner From this month onwards, applying for a new fund offer (NFO) will be a whole new ball game as the Securities and Exchange Board of India (SEBI) has changed the NFO environment drastically. It has reduced the window for listing of NFOs to 15 days from the earlier 30 days and has also brought down the allotment to 5 days from the earlier 30 days.

This will now bring down the processing time for completion of NFOs from 60 days to an astounding 20 days only. This move will also bring with it concerns for investors about whether they will be able to submit their applications on time. Advisors will also be worried as to whether they would be able to execute client orders in time.

To address these concerns, the registrar and transfer agent Computer Age Management Services (CAMS) has come out with an online service ‘eNFO’ to support online submission of NFO applications. It is another ‘industry first’ initiative from CAMS, which will simplify the application process for all participants. It will also enable AMCs to reach and collect applications from multiple cities where there are no official transaction points. The facility will be available to investors on the CAMS website, www.camsonline.com.

Source : Money Life

Canara Robeco IndiGo Fund –Review

Canara Robeco Indigo Fund is an Open Ended Scheme launched by the Canara Robeco AMC.

Inside_04

Fund Specifics:

 

Instruments Indicative Allocations (% of total assets)
Minimum Maximum
    Indian Debt and Money Market Instruments 65 90
    Gold ETFs 10 35

Exposure by the Scheme in Securitised Debt shall not exceed 25% of the Net Assets of the Scheme at the time of investment. Gross Notional Exposure by the Scheme in fixed income derivative instruments for the purpose of hedging and portfolio rebalancing shall not exceed 30% of the Net Assets of the Scheme at the time of investment. Total of investments in debt securities (including securitized debt), money market instruments, Gold ETFs and gross notional exposure in derivatives shall not exceed 100% of the net assets of the Scheme.

Fund Manager Mr. Ritesh Jain
Minimum Application Amount  
  • Initial Purchase – 5,000 and multiples of Re.1 thereafter
  • Subsequent Purchase – 1000 and multiples of Re. 1 thereafter
Benchmark   CRISIL Short Term Bond Fund Index + Price of Gold (neutral allocation: 65:35)
Facilities Offered  

Systematic Investment Plan (SIP) –

  • Minimum instalment amount – 2,000 and 1,000 respectively for quarterly and monthly frequency respectively and in multiples of Re 1 thereafter   
Investment Option(s)  
  • Growth
  • Quarterly Dividend Payout
  • Quarterly Dividend Re-investment
Entry Load  

Lump sum / SIP

  • Nil
Exit Load / Switch – Over Load  

Lump sum / SIP

  • 1% if redeemed / switched – out within 1 year from the date of allotment
  • NIL if redeemed / switched – out after 1 year from the date of allotment

Axis MF adds 1.56 lakh folios in seven months while equity schemes lose 2.87 lakh folios

 Barrow Money Axis MF has added 1.56 lakh folios since November 2009 while JPMorgan, ING Investments and HSBC MF have seen their folios dwindling Equity funds have lost 2.87 lakh investor accounts between November 2009 and May 2010 when the mutual fund (MF) industry witnessed the launch of 10 new equity funds in the same period.

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Reliance Mutual Fund has lost the most accounts in its equity schemes. Its folios decreased from 63.89 lakh in November 2009 to 61.06 lakh in May 2010, a decline of 2.83 lakh folios. Similarly, L&T MF, Franklin Templeton and Tata MF have seen their aggregate equity folios dropping by 3.27 lakh in the same period. Folios are numbers designated to the investor accounts. Each investor can have multiple accounts. The 37 fund houses lost around 2.87 lakh folios in equity schemes from November 2009 to May 2010.

The 30-share Bombay Stock Exchange (BSE) Sensex has remained flat between November 2009-May 2010. According to the data available on the Association of Mutual Funds in India (AMFI) website, 19 fund houses have lost an average 8% of their folios since November 2009.

Axis MF had 491 folios in November 2009, which increased to 1,56,971 folios at the end of May 2010.

Among the larger fund houses, HDFC Asset Management Co Ltd, UTI Asset Management Company Ltd and Birla Sun Life Asset Management Co Ltd together added 6.53 lakh investor accounts since November 2009. Tata Asset Management Ltd, SBI Funds Management Pvt Ltd, Reliance Capital Asset Management Ltd, LIC Mutual Fund Asset Management Co Ltd, ICICI Prudential and Franklin Templeton together lost 5.81 lakh investor accounts in the same period. The 37 fund houses added just 49,153 folios between November 2009 and May 2010.

Source:Moneylife

How does a Daily SIP work?

Money (reais)

Image via Wikipedia

The Systematic Investment Plan is ideal for investors who have a regular flow of money (such as employees). A simple instruction to the fund house and the bank will help them invest regularly at a given time and stay away from the volatility of the stock market. When you invest a fixed amount, such as Rs 5000 a month, you buy fewer units when the share prices are high and more units when the share prices are low. How do you avoid or minimise the effects of an extremely volatile stock market? Given the choice between the asset classes, and the yo-yoing of almost every fund, do you dare to invest in it at all? What if there was a middle path? The Systematic Investment Plan is ideal for investors who have a regular flow of money (such as employees). A simple instruction to the fund house and the bank will help them invest regularly at a given time and stay away from the volatility of the stock market. When you invest a fixed amount, such as Rs 5000 a month, you buy fewer units when the share prices are high and more units when the share prices are low.

The reinvention of the Systematic Investment Plan (SIP) has been a boon for investors with a low risk appetite. Rupee cost averaging and compounding are added advantages. But what exactly is a Daily SIP? And how does it benefit you, the customer? Simply, a Daily SIP collects a small sum from an individual on a daily basis and invests it in the market. It operates like any mutual fund, where the disbursement and handling of the money is the fund manager’s prerogative. Rupee cost averaging occurs when the market goes down, and more units of the scheme can be purchased because of a lower net asset value. However, most companies have SIP schemes that allow you to invest on different dates of the month. Daily SIPs are expected to minimise risk and generate greater risk-adjusted returns while increasing participation.

Daily SIPs: Advantages

Affordability, volatility and convenience are the most obvious advantages of investing in a Daily SIP. With a Daily SIP, your investment is staggered. Instead of a lump-sum amount, you invest a pre-specified amount in a scheme at pre-specified intervals at the then prevailing NAV. Consistent monetary contributions average out the crests and troughs of any market, in the long term. It also captures the daily levels of market volatility. In case of a monthly SIP, you still can lose out if the markets are up on the chosen day of the month. The daily SIP, however, eliminates this flaw and lets you benefit out of equity market volatility. If you’re looking at a lump-sum investment, then going in for a daily SIP would allow you to take advantage of the market volatility, by splitting the lump sum amount in to daily instalments over a relatively short time frame. The Daily SIP is ideal for small time savers, since the threshold investment level is low. Once you start with a Daily SIP, you invest at the appointed time and that makes you a disciplined investor. With Daily SIPs, you capitalise on the periodic dips in the market and accumulate a greater number of units at lower levels-and over time, reduce your average unit cost. You avoid the lure and trap of trying to predict the market.

A word of caution

Usually, a fund charges 2.25% of invested amount as the ‘entry load’. However, in some cases this amount may get reduced. You should also keep in mind the contribution after taking into account the cash flows available. Check if there are any incremental transaction charges attached to each investment. Especially in the case of auto-debit, there may be a fee for every transaction. You need to remain invested in a Daily SIP for at least 3 years to reap the benefits, and monitoring this on a daily basis can be annoying. If you should fail to pay the SIP amount on any particular working day, your investment will not default but your return will be adjusted against the failure of payment for that day.

Source : Bank Bazaar

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SEBI asks for better disclosure of mutual fund performance

SEBI has proposed wide-ranging changes in the way fund performance is currently presented. But it is not clear whether investors will know how to use it and whether they will Market regulator Securities and Exchange Board of India (SEBI) has proposed a new set of quantitative measures for disclosing an equity scheme’s performance. SEBI has proposed that fund returns will be calculated and disclosed in an annualised manner by using both capital gains (change in NAV over a period of time) and the dividend paid out per unit. The returns are proposed to be compared to a popular index such as Nifty and Sensex apart from the scheme’s own chosen benchmark. This will give a clearer picture of comparison between absolute returns of a scheme, benchmark returns and the market indices (Nifty or Sensex), especially since index funds are proving to be a better bet than many actively-managed funds. SEBI wants risk-adjusted return to be disclosed as well. The volatility of benchmarks and the schemes is also proposed to be disclosed which will provide a comparison between risk of the scheme, benchmark and the market. Funds may be asked to disclose the beta of a scheme to show the volatility of portfolio and that of the Nifty or Sensex. Expense ratio will also be a part of disclosure as expenses have a direct bearing on the fund performance. SEBI also wants portfolio turnover ratio disclosed. A higher turnover indicates that the fund manager is churning the portfolio very often. Reacting to the SEBI proposals, Ajit Dayal, director, Quantum Mutual Fund told Moneylife: “It’s very good that SEBI is trying to standardise performance which has become a racket in the industry where people are using performance numbers to fool investors. Unfortunately over 15 years of existence, many of the large fund houses in the industry have chosen not to bother about their investors and worry more about the assets that they can gather.” However, another CEO of an asset management company felt that while all this information is completely useful, it is impractical to expect the investors to understand them and act upon them. “This information is useful for financial planners and advisors. And they already have access to this data. To put all this sophisticated information in the public domain is simply overkill.” “It’s great that there is more transparency from what has largely been a most unfriendly stance towards the investor industry. But it does not take away the fact that risk is different for different investors,” added Mr Dayal.

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AMFI Mutual Fund Certification Program Discontinued

AMFI(Association Of Mutual Funds India) discontinued the AMFI Certification Program effective from June 1,2010. Test for AMFI Mutual Fund (Basic)Module and AMFI Mutual Fund (Advisors) Module will not be conducted from June 1, 2010.

National Institute of Securities Markets (NISM) would be conducting Mutual Fund Distributors Certification Examination from June 1, 2010 onwards.

What is NISM?

National Institute of Securities Markets (NISM) is a public trust, established by the Securities and Exchange Board of India (SEBI), the regulator for securities markets in India. It is located in Navi Mumbai, India. NISM seeks to add to market quality through educational initiatives. It is an autonomous body governed by its Board of Governors. An international Advisory Council provides strategic guidance to NISM.

NISM consists of six different schools as follows:

  1. School for Investor Education and Financial Literacy (SIEFL)
  2. School for Certification of Intermediaries (SCI)
  3. School for Securities Information and Research (SSIR)
  4. School for Regulatory Studies and Supervision (SRSS)
  5. School for Corporate Governance (SCG) School for Securities Education (SSE)

For further details please log on to NISM

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