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Mutual Fund Newsletter - November 12 to November 16, 2012

India Infoline News Service/ 15:42 , Nov 16, 2012

Since the U.S. credit crisis, both SEC changes implemented in 2010 and ongoing investor risk aversion have driven U.S. prime money market funds (MMFs) to significantly increase their portfolio liquidity, as discussed in a new Fitch Ratings study.

Top Stories

NSE sets new record in gold ETF

On the auspicious occasion of Dhanteras, the National Stock Exchange (NSE) has recorded the highest ever traded value, on a single day in gold ETF’s. The traded value was Rs. 13.37 billion in gold ETFs, at the close of trading on Sunday 11 November 2012.

Last year on Dhanteras, NSE had recorded a traded value of Rs. 6.36 billion. This year’s Rs. 13.37 billion is a 110 per cent increase from last year’s levels. Gold ETF units worth 4,441 kg’s were traded on Dhanteras (each unit of ETF is equal to a gram of gold), which is an 81 per cent increase from last year’s Dhanteras levels… Read more

Inflows in equity MF declines over 2% to Rs. 1.59 trillion in Oct

The assets under management (AUM) of mutual funds rose 6.7% to Rs. 7.68 trillion in October from Rs. 7.20 trillion in September 2012, according to AMFI (Association of Mutual Funds in India) data.

Investments in income funds in October increased 8.85% to Rs. 3.83 trillion from Rs. 3.52 trillion in September 2012. In the same period, liquid and money market funds (short-term funds) recorded a 13.62% rise (Rs. 197.03 billion) in AUM to Rs.1.64 trillion from Rs. 1.45 trillion, the AMFI data said.

On the other hand, investment in equity schemes declined by 1.99% to Rs. 1.59 trillion in October 2012 from Rs. 1.63 trillion in September 2012.

Gold MFs report 9.5% returns in last 1 year

In the last one year, e-gold and gold mutual funds have recorded 11.3% and 9.5% against returns on gold exchange-traded funds (ETFs) which stood 8.36%, according to media reports.

Global investment in ETFs in September quarter of 2012-13 was up significantly by 56% on the previous year. E-gold is an electronic form of gold investment for which one needs to open a demat account with any of the depository participants of the National Spot Exchange… Read more

Domestic News

Fund houses may shell out Rs. 5 lakh for MF Utility: Reports

The work on setting up a mutual fund transaction platform called MF Utility is expected to begin soon—once the contract for the project is awarded by AMFI (Association of Mutual Funds in India). AMCs (asset management companies) may shell out around Rs. 5 lakh each, which amounts to over Rs. 2.5 crore from almost 50 fund houses, according to media reports.

The Association of Mutual Funds in India has already got Securities and Exchange Board of India (SEBI) approval for setting up the online MF Utility platform. The MF Utility—an online service—will facilitate efficient and cost effective transaction processing… Read more

Reliance Capital’s arm posts net profit of Rs. 310 million for Sept quarter

Reliance Life Insurance—part of Reliance Capital—reported net profit of Rs. 310 million for the quarter ended September 30.

Reliance Life’s total funds under management increased 16% in the second quarter of current fiscal to Rs. 194.17 billion. The total premium (net of reinsurance) for the September 2012 quarter was Rs. 10.03 billion. On quarterly basis, Reliance Life's net profit zoomed 63% from Rs. 190 million in the quarter ended June 30, 2012.

FM, labour ministry in talks for investments in IDFs: Reports

To attract long-term investments in the infrastructure sector, the finance ministry is in talks with the labour ministry to allow provident funds (PFs) to invest in IDFs (infrastructure debt funds), the media reports said.

The labour ministry administers over Rs 5 trillion through the Employees' Provident Fund Organisation (EPFO), which manages the retirement savings of 60 million organised sector workers. Around Rs. 2 trillion is estimated to be managed by gratuity, pension funds run by India Inc and the new pension scheme (NPS) run by the Pension Fund Regulatory and Development Authority (PFRDA), the reports added… Read more

Equity markets improve with reform measures & FII inflows

Equity markets also improved in Q2 of 2012-13 on account of revival in sentiment and the turnaround in foreign institutional investor (FII) inflows. At a level of 18,758, the BSE Sensex is 8.7% higher than it was at the same time last year. Market sentiments, turned positive due to improved global liquidity conditions, FII inflows and the recent policy measures announced by the government, the report added.

However, governance issues and mixed Q2 results of some major companies pared some of the gains recorded earlier. During 2012-13 so far (up to October 23, 2012), FIIs made net investments of about Rs. 497 billion in the Indian equity market, the RBI report mentioned… Read more

Construction, capital goods sectors to attract investments

Cement, construction and capital goods (CCC) sectors have started gaining significance of fund managers. Due to low economic and political reforms, most fund managers had cut their exposure to CCC sectors. However, with the situation improving now and a rise in number of reforms and their execution, CCC sectors have started attracting find managers, the media reports said.

For instance, exposure in shares of capital goods witnessed a rise of 16 basis points. One basis points is equal to 1/100th of 1%. Cement and construction witnessed fund managers scaling up their investments by 30 basis points over the last two months, the reports added… Read more

Muthoot Finance to offer national pension scheme

Kerala-based Muthoot Finance Ltd has signed an agreement with the Pension Fund Regulatory and Development Authority (PFRDA) to offer National Pension Scheme (NPS).

According to George Alexander Muthoot, managing director, Muthoot Finance, with the company’s pan-India presence and around 4,000 branches in urban and rural areas, it will ensure that the advantages of NPS reaches the maximum number of Indians… Read more

Learning

Should you renew your SIP and how?

There are many advantages of starting an SIP (systematic investment plan) in our mutual fund schemes. An SIP provides benefits of rupee cost averaging, disciplined investing and is lighter on wallet. The minimum investment amount for SIP differs from AMC (asset management company) to AMC… Read more

Special Stories

Global gold demand reflects challenging economic climate: WGC

Global gold demand in Q3 2012 was 1,084.6 tonnes (t), down 11% from the record Q3 2011 figure of 1,223.5t. This dip in demand is in comparison with exceptional demand in Q3 last year. Gold demand remains resilient. Q3 2012 was above the five year quarterly average of 984.7t, according to the World Gold Council’s Gold Demand Trends Report.

The key findings from the report are: Global investment in ETFs over the September quarter was up significantly by 56% on the previous year… Read more

In-person verification for investment in ‘new’ mutual funds

From December 1, 2012, certain additional information needs to be submitted as well as an ‘in person verification’ (IPV) needs to be completed for further investments in any mutual fund (other than the one in which the investors have already invested).

SEBI (Securities and Exchange Board of India) vide circular MIRSD/SE/Cir-21/2011 dated October 5, 2011 has recommended / mandated all mutual fund investors, that the standard KYC form and supporting documents is to be used in accordance with the uniform KYC guidelines… Read more

Leader Speak

10-yr G-Sec yield to trade in range of 8.1%-8.25%: Indiabulls MF

We take a practical and conservative approach to investing. Preservation of capital is central to our management philosophy and risk control lies at the heart of our investment process, Raju Sharma, Head Fixed Income, Indiabulls Mutual Fund, says… Read more

International News

Regulations & risk aversion drive post-crisis US money fund liquidity

Since the U.S. credit crisis, both SEC changes implemented in 2010 and ongoing investor risk aversion have driven U.S. prime money market funds (MMFs) to significantly increase their portfolio liquidity, as discussed in a new Fitch Ratings study.

As of end-September 2012, liquid assets represented approximately 45% of MMF assets, compared to approximately 20% of total assets at end-2006. Fitch's study identifies three distinct phases when MMFs increased liquidity: (1) during the U.S. financial crisis, particularly after the August 2007 stresses affecting structured investment vehicles and the asset-backed commercial paper market; (2) after the announcement and implementation of the 2010 Rule 2a-7 amendments; and (3) during mid-2011 as Eurozone market volatility started to escalate… Read more

Equity funds estimated outflows of US$1.82bn for last 7 days

Total estimated inflows to long-term mutual funds were US$6.24bn for the week ended Wednesday, November 7, the Investment Company Institute reported today. Flow estimates are derived from data collected covering more than 95 percent of industry assets and are adjusted to represent industry totals.

Equity funds had estimated outflows of US$1.82bn for the week, compared to estimated outflows of US$2.49bn in the previous week. Domestic equity funds had estimated outflows of US$2.12bn, while estimated inflows from world equity funds were US$300 million… Read more

NFOs

ICICI Pru MF unveils 36 months Capital Protection Oriented Fund

ICICI Prudential Mutual Fund has launched ICICI Prudential Capital Protection Oriented Fund III-Plan A-36 Months Plan, a close ended capital protection oriented fund. The tenure of the scheme is 1,100 Days. The new issue will be open for subscription from 20 November and close on 27 November 2012… Read more

IDFC Fixed Maturity Plan Yearly Series 54 announces dividend

IDFC Mutual Fund has announced 19 November 2012 as the record date for declaration of dividend under the dividend option and quarterly dividend option of IDFC Fixed Maturity Plan Yearly Series 54. The quantum of dividend will be entire distributable surplus as on record date i.e. 19 November 2012, on the face value of Rs 10 per unit.

ICICI Pru MF launches 367 Days fixed maturity plan

ICICI Prudential Mutual Fund has launched ICICI Prudential Fixed Maturity Plan-Series 65-367 Days Plan B, a close ended debt scheme. The tenure of the scheme is 367 days… Read more

UTI Fixed Income Interval Fund Qly Interval Plan III announces dividend

UTI Mutual Fund has announced 19 November 2012 as the record date for declaration of dividend under the dividend option of UTI Fixed Income Interval Fund Quarterly Interval Plan III. The quantum of dividend per unit will be 100% of distributable surplus as on the record date on the face value of Rs 10 per unit.

Peerless Short Term Fund declares dividend under monthly dividend option

Peerless Mutual Fund has declared dividend under the Monthly Dividend Option of Peerless Short Term Fund, an open ended debt scheme. The record date for dividend was 9 November 2012… Read more

Kotak Quarterly Interval Plan Series 7 announces dividend

Kotak Mutual Fund has announced 20 November 2012 as the record date for declaration of dividend under the dividend option of Kotak Quarterly Interval Plan Series 7. The quantum of dividend per unit will be entire appreciation in Net Asset Value of dividend option until 20 November 2012 on the face value of Rs 10 per unit.

SBI Debt Fund Series-366 Days-18 floats on

SBI Mutual Fund has launched SBI Debt Fund Series-366 Days-18, a close-ended debt scheme with the duration of 366 days. The new issue will be open for subscription from 19 November and close on 23 November 2012… Read more

HDFC Mutual Fund launches HDFC FMP 371D November 2012 (2)

HDFC Mutual Fund has launched HDFC FMP 371D November 2012 (2), a plan under HDFC Fixed Maturity Plans-Series 23 (a close-ended income scheme). The new issue will be open for subscription from 22 November and will close on 4 December 2012… Read more

IDFC Fixed Maturity Plan Yearly Series 54 announces dividend

IDFC Mutual Fund has announced 19 November 2012 as the record date for declaration of dividend under the dividend option and quarterly dividend option of IDFC Fixed Maturity Plan Yearly Series 54. The quantum of dividend on the face value of Rs 10 per unit will be entire distributable surplus as on record date.

ICICI Pru Interval Fund II-Qly Interval Plan B announces dividend

ICICI Prudential Mutual Fund has announced 16 November 2012 as the record for declaration of dividend under the dividend options of ICICI Prudential Interval Fund II-Quarterly Interval Plan B. The recommended rate of dividend on the face value of Rs. 10 per unit will be Rs. 0.1901 per unit under retail option and Rs. 0.1956 per unit under institutional option.

SBI Debt Fund Series-90 Days-68 announces dividend

SBI Mutual Fund has announced 15 November 2012 as the record date for declaration of dividend under the dividend option of SBI Debt Fund Series-90 Days-68. The quantum of dividend per unit will be entire distributable surplus as on record on the face value of Rs 10 per unit. The scheme would mature on 15 November 2012 and accordingly, units shall be suspended from trading on the BSE.

LIC Nomura MF announces dividend for Nomura Interval-Qly Plan-Series 2

LIC Nomura Mutual Fund has announced 19 November 2012 as the record date for declaration of dividend on the face value of Rs 10 per unit under the dividend option of LIC Nomura MF Interval Fund-Quarterly Plan-Series 2. The quantum of dividend will be entire distributable surplus as on the record date.

L&T MF announce changes in mutual fund schemes

L&T Mutual Fund has announced the following changes which from 12 November 2012… Read more

Franklin Templeton MF announces dividend under 2 schemes           

Franklin Templeton Mutual Fund has announced 16 November 2012 as the record for declaration of dividend under the following schemes… Read more

 

 

 

 

 



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