Top Stories
IFA groups work towards upliftment of distributors
Mutual fund distributors or IFAs (independent financial advisors) are recognising the importance unity. In 2009, capital market regulator SEBI (Securities and Exchange Board of India) banned entry load on mutual funds which not only dried up inflows into the sector, but also jolted the IFAs to come together and form associations.
Many IFA associations are created in the last three years. Karnataka Association of Mutual Fund Advisors (KAMFA) was established in August 2009 as a co-operative society by a group of 14 members. The society was set up so that the IFAs in Karnataka have a common platform. KAMFA strives to present IFA views so that they contribute to the industry/regulatory decision making process… Read more
Who says direct is a lower cost model anyway?
Foundation of Independent Financial Advisors (FIFA) had represented to capital market regulator SEBI (Securities and Exchange Board of India) on 10th August, when it first heard of the regulator’s intention to consider a direct share class.
Reproduced below is the text of its well-reasoned case urging SEBI not to bring in a direct share class, which FIFA believes will further weaken retail investors access to investment advice, as such a move can potentially further reduce an already shrinking IFA (independent financial advisors) community. FIFA also urged SEBI to follow a more consultative and participative approach before announcing such large structural changes… Read more
SEBI removes in-person verification norms for non-individual clients
Capital market regulator SEBI (Securities and Exchange Board of India) has reduced the Know Your Clients (KYC) requirements for various overseas entities including FIIs (foreign institutional investors) and has removed in-person verification requirements for non-individual clients. SEBI has given clarifications on KYC norms for FIIs, sub-accounts and qualified foreign investors (QFIs).
In a circular, SEBI said foreign organisations such as Sovereign Wealth Fund and overseas government agencies would not be required to provide residential and photograph, among others, to meet KYC requirements. The circular was issued by the regulator on 5th September… Read more
Direct plan seeks to introduce distributor based differentiation: FIFA
Since 2009, mutual fund (MF) industry has seen a dramatic decline in inflows resulting in degrowth of the industry. Prime Minister Dr Manmohan Singh and Finance Minister P Chidambaram have both expressed the need to re-energise the MF industry. To reenergise the industry, capital market regulator SEBI (Securities and Exchange Board of India) recently announced a number of steps.
The measures announced for increasing the penetration of MFs, enhancing the reach of schemes in smaller cities, alignment of the interest of various stakeholders, protection of investors from issues of mis-selling and churning, steps to be taken for regulatory framework of MFs shall provide a fillip to the industry… Read more
Learning
Basic services demat account for small investors
Most of us who don’t invest regularly in stocks, bonds, gold ETFs, IPO, etc may find maintaining our demat accounts a pain because of the charges. The costs, such as annual maintenance and statement charges, make these accounts relatively expensive.
But with the introduction of basic service demat account (BSDA) by SEBI (Securities and Exchange Board of India), the annual maintenance charges structure will be on a slab basis. Here we provide you with the fundamental information about BSDA… Read more
Fund Managers’ Speak
MF industry has not been able to mobilise savings from investors
According to Quantum MF, owing to the uncertainty in the capital markets, thanks to the turmoil in the Euro zone, the mutual fund industry has not been able to mobilize savings from the investors and therefore has been going through a rough patch since quite some time now. But soon they could get a respite from the capital market regulator, SEBI… Read more
Domestic News
SEBI settles charges against Sanjay Sanghvi in HDFC MF front running
Capital market regulator SEBI (Securities and Exchange Board of India) settled a case against Sanjay Sanghvi, after he agreed to pay Rs. 15 lakh and undergo a voluntary debarment for 36 months to settle charges of fraudulent trade practices in the alleged front running in shares traded by HDFC Asset Management Company (AMC)… Read more
MFs underperform benchmark over last 5 years
The latest S&P Indices Versus Active Funds (SPIVA) scorecard, produced by S&P Dow Jones Indices in partnership with CRISIL, highlights that the majority of actively managed Indian equity mutual funds have underperformed their respective benchmark indices over the last five years, period ending June 2012. The percentage of actively managed equity funds underperforming the benchmark indices has seen a declining trend since December 2010; however, their number still exceeds those outperforming the indices… Read more
IFAs, FIFA show concerns over direct plans
In August, capital market regulator SEBI (Securities and Exchange Board of India) announced several decisions to attract retail participation in the mutual funds industry. But, the regulator’s decision stand imperilled by the clause that mandates mutual fund companies to create a direct plan variant for their schemes. Such a variant would be available only to those who are investing directly with the asset management companies and would be available at a lower expense ratio. However, no details are provided about how much lower the expense ratio would be… Read more
HDFC Mutual Fund ties up with Syndicate Bank
HDFC Mutual Fund and Syndicate Bank have entered into an alliance to offer HDFC Mutual Fund's schemes through the bank’s 2700 plus branches across the country… Read more
Reliance Capital to mull special dividend on Sept 10
Reliance Capital Ltd. has informed the exchanges that a meeting of the Board of Directors of the Company will be held on September 10, 2012, inter alia, to consider special interim dividend, if any… Read more
Gilt funds asset weighted returns to be lower
The latest S&P Indices Versus Active Funds (SPIVA) scorecard, produced by S&P Dow Jones Indices in partnership with CRISIL, points out asset weighted returns of gilt funds continued to be lower than equal weighted returns.
This trend is being observed for the fifth consecutive edition of the S&P CRISIL SPIVA scorecard. This indicates that larger sized gilt funds continue to underperform their smaller sized peers. Gilt funds underperformed their benchmark (CRISIL Gilt Index) on both equal and asset weighted basis across timeframes (1, 3 and 5 years)… Read more
Hybrid funds–MIPs outperform benchmark
The latest S&P Indices Versus Active Funds (SPIVA) scorecard, produced by S&P Dow Jones Indices in partnership with CRISIL, highlights Debt oriented hybrid funds (MIPs) outperformed their benchmark index (CRISIL MIP Blended Fund Index) across 1, 3 and 5-year time frames on both equal and asset weighted returns basis. Asset weighted returns were also higher than equal weighted returns for the category. Thus, MIPs with better performance had larger assets under management (AUM). In case of balanced funds, asset weighted returns were higher than equal weighted returns for all time frames analysed except the 1-year period… Read more
NFOs
Taurus MF launches 370 Days Fixed Maturity Plan
Taurus Mutual Fund has launched Taurus Fixed Maturity Plan-Series V (370 Days), a close ended debt scheme with the duration of 370 days from the date of allotment of units. The new issue will close on 11 September 2012… Read more
Tata MF announces changes in Floater Fund
Tata Mutual Fund has announced that pursuant to the change in face value of units under Tata Floater Fund from Rs. 10 per unit to Rs. 1000 per unit, the minimum amount for additional purchase & redemption in unit terms is revised as following with effect from 10 September 2012: Minimum additional purchase: Rs. 10,000.
Kotak Quarterly Interval Plan Series 1 announces dividend
Kotak Mutual Fund has announced 12 September 2012 as the record date for declaration of dividend under the dividend option of Kotak Quarterly Interval Plan Series 1. The quantum of dividend will be entire appreciation in Net Asset Value of dividend option until 12 September 2012 on the face value of Rs. 10 per unit.
UTI MF announces dividend under Fixed Income Interval Fund-Monthly Interval Plan II
UTI Mutual Fund has announced 11 September 2012 as the record date for declaration of dividend under the dividend option of UTI Fixed Income Interval Fund -Monthly Interval Plan II. The amount of dividend per unit will be 100% of distributable surplus as on the record date on the face value of Rs. 10 per unit.
ICICI Pru MF announces dividend under Interval Fund II-Qly Interval Plan D
ICICI Prudential Mutual Fund has announced 11 September 2012 as the record date for declaration of dividend under the dividend options of ICICI Prudential Interval Fund II-Quarterly Interval Plan D.
IDBI CD Liquid Fund files offer document with SEBI
IDBI Mutual Fund has filed offer document with Sebi to launch IDBI CD Liquid Fund, an open ended liquid scheme. The NFO price will be Rs. 10 per unit. The investment objective of the scheme will be to provide investors with high level of liquidity along with regular income for their investment… Read more
IDBI Debt Opportunities Fund files offer document with SEBI
IDBI Mutual Fund has filed offer document with Sebi to launch IDBI Debt Opportunities Fund, an open ended income fund. The objective of the scheme is to generate regular income and opportunities for capital appreciation while maintaining liquidity through active management of a diversified portfolio comprising of debt and money market instruments across the investment grade credit rating and maturity spectrum… Read more
UTI-Treasury Advantage Fund-Institutional Plan-Bonus Option announces bonus
UTI Mutual Fund has announced 11September 2012 as the record date for declaration of bonus under UTI-Treasury Advantage Fund - Institutional Plan-Bonus Option. The quantum of bonus will be 2:5 ratio (2 units for every five units) on the face value of Rs. 1000 per unit.
Religare MF launches Fixed Maturity Plan-Series XV-Plan F
Religare Mutual Fund has launched a new fund named as Religare Fixed Maturity Plan - Series XV - Plan F (369 Days), a close ended debt scheme. The tenure of the scheme is 369 days from the date of allotment. The new issue will close subscription on 12 September 2012… Read more
CARE Assigns CARE AAmfs Credit Quality Rating To Taurus Dynamic Income Fund
CARE has assigned credit quality rating of 'CARE AAmfs' to Taurus Dynamic Income Fund. The fund is managed by Taurus Asset Management Company. Taurus Dynamic Income Fund was launched in January 2011. The investment objective of the scheme is to generate optimal returns with high liquidity through active management of the portfolio by investing in Debt and Money Market Instruments. The fund house will manage the portfolio of Taurus Dynamic Income Fund such that it meets the CARE's criteria to qualify for the credit quality rating of 'CARE AAmfs'.
LICMF Fixed Maturity Plan Series 58-67 files offer document with Sebi
LIC Mutual Fund files offer document with Sebi to launch LICMF Fixed Maturity Plan Series 58 to 67, a close ended income scheme. The New Fund Offer price is Rs. 10 per unit. The investment objective of the Scheme is to minimize interest rate risk by investing in a portfolio of fixed income securities which mature on or before the maturity of the scheme… Read more
SBI announces restructuring and merger of schemes
SBI Mutual Fund has decided to restructure SBI Magnum Income Plus Fund - Savings Plan into SBI EDGE Fund and merge SBI Magnum NRI Investment Fund - Flexi Asset Plan into SBI EDGE Fund in the interest of all the unitholders in the respective schemes and in order to benefit from better economies of scale that will allow for more efficient management of these funds… Read more
ICICI Pru Fixed Maturity Plan-Series 66 files offer document with SEBI
ICICI Prudential Mutual Fund has filed offer document with Sebi to launch ICICI Prudential Fixed Maturity Plan - Series 66, a close ended debt scheme. The New Fund Offer price is Rs. 10 per unit. The scheme will have plans A to L. The Plans under the Scheme will have duration of 3 months to 60 months from the date of allotment.
The investment objective of the Plans under the Scheme is to seek to generate income by investing in a portfolio of fixed income securities/debt instruments maturing on or before the maturity of the plans under the scheme… Read more
JP Morgan India Medium Term Bond Fund files offer document with SEBI
JPMorgan Mutual Fund has filed offer document with Sebi to launch JPMorgan India Medium Term Bond Fund, an open ended income scheme. The investment objective is to provide regular income and capital appreciation following a conservative risk strategy through investments made primarily in Money Market Instruments, a range of medium term and short term Debt Securities of average maturity of greater than 1 year and up to 60 months with limited exposure to Government of India Securities… Read more
JP Morgan India Low Duration Fund files offer document with SEBI
JPMorgan Mutual Fund has filed offer document with SEBI to launch JPMorgan India Low Duration Fund, an open ended income scheme. The investment objective is to provide regular income, liquidity and nominal capital appreciation through investments made primarily in Debt Securities and Money Market Instruments following a relatively low risk strategy while having exposure to short term debt of average maturity greater than 1 year and up to 18 months… Read more
SBI Mutual Fund announces dividend under SBI Debt Fund Series-90 Days-65
SBI Mutual Fund has announced 10 September 2012 as the record date for declaration of dividend under the dividend option of SBI Debt Fund Series-90 Days-65. The quantum of dividend per unit will be entire distributable surplus as on the record date on the face value of Rs. 10 per unit.
Kotak Mahindra MF announces dividend under Quarterly Interval Plan Series 4 and 8
Kotak Mahindra Mutual Fund has announced 10 September 2012 as the record date for declaration of dividend under the dividend options of Kotak Quarterly Interval Plan Series 4 and 8.
ICICI Pru Multiple Yield Fund-Series 4 files offer document with SEBI
ICICI Prudential Mutual Fund has filed offer document with Sebi to launch ICICI Prudential Multiple Yield Fund - Series 4, a closed-end income scheme. The New Fund Offer price is Rs. 10 per unit. The scheme has Plans from A to H, having tenure of 12 to 60 months including respective date of allotment.
In Focus Stories
Should you opt for MF with free insurance cover?
Fund houses like ICICI Prudential Mutual Fund, Reliance Capital Asset Management Company and Birla Sun Life Mutual Fund have been launching insurance-wrapped funds.
ICICI Pru MF introduced Systematic Investment Plan Insure facility (SIP Insure) in selected schemes in May 2012. SIP Insure is an optional feature in addition to SIP. A group life insurance cover shall be provided under this facility by a life insurance company. The premium for providing such cover shall be borne by ICICI Prudential AMC. The minimum installment will be Rs. 1,000 for all schemes except ICICI Prudential Tax Plan for which the minimum amount is Rs. 500. Maximum age up to which SIP Insure is available is 55 years… Read more
New Appointments
Sahara MF announces change in key personnel
Sahara Mutual Fund has announced change in key personnel with effect from 5 September 2012. Accordingly, Himanshu Rai Choubey, age 27 years has been appointed as a dealer for debt schemes of Sahara Mutual Fund. He is a MBA (Finance) by qualification. Shray Taneja, dealer (debt) ceases to be key personnel for the schemes of Sahara Mutual Fund.
IDFC Mutual Fund announces change
IDFC Mutual Fund has decided the following: Minimum application/subscription amount for investment by group companies: In case of investment by company belonging to the same group, the minimum application/subscription amount of all the schemes of IDFC Mutual Fund under each plans shall be considered at group level with effect from 7 September 2012, provided that the said company certifies that the investing company is part of the same group.
International news
ECB unveils new bond-buying plan to calm debt markets
The Governing Council of the European Central Bank (ECB) has on Thursday taken decisions on a number of technical features regarding the Eurosystem’s outright transactions in secondary sovereign bond markets that aim at safeguarding an appropriate monetary policy transmission and the singleness of the monetary policy. These will be known as Outright Monetary Transactions (OMTs) and will be conducted within the following framework… Read more