Mutual Fund Newsletter: 25-29 November, 2013

India Infoline News Service | Mumbai |

The government is planning to modify the disinvestment scheme by reviving the defunct Specified Undertaking of Unit Trust of India and launching public-sector ETFs

Top Stories

Mutual funds offload Rs. 4,018 crore in equity in October

Asset management companies (AMCs) made net investment of Rs. 33,153 crore in the secondary market in October 2013 compared to net investment of Rs. 79,169 crore in September 2013, according to SEBI (Securities and Exchange Board of India).

Mutual funds sold Rs. 4,018 crore in equity in October 2013 compared to Rs. 2,801 crore sold in September 2013. Mutual Funds invested Rs. 37,171 crore in debt market in October 2013 as against of Rs. 81,970 crore invested in September 2013... Read more

MFs report net outflow of Rs. 33,910 crore in October

During October 2013, mutual funds saw a net inflow of Rs. 66,325 crore as compared to the outflow of Rs. 33,910 crore.

The private sector mutual funds net inflow stood at Rs. 47,215 crore, while public sector mutual funds saw inflow of Rs. 19,111 crore in October, according to SEBI (Securities and Exchange Board of India)... Read more

Govt plans to modify disinvestment scheme by reviving SUUTI

The ministry on finance has selected six companies for the government's disinvestment programme, according to a media report.

The finance ministry is also planning to modify the disinvestment scheme by reviving the defunct Specified Undertaking of Unit Trust of India (SUUTI) and launching public-sector exchange-traded funds (ETFs), the report said.

The department of disinvestment expects that ETF will encourage long-term foreign investors to participate in the divestment programme as that would also guard the country against sudden outflows and also finance its current account deficit, the report further said... Read more

Special Stories

PFRDA has made progress; but lot remains to be done: Takru

Rajiv Takru, Secretary (Financial Services), Ministry of Finance, delivering the Inaugural Address at the 1st CII Pensions Summit on Wednesday organized by CII emphasized the need for greater participation from the private sector to scale up the National Pension System on the foundation of providing safety and value for money for investors.

Commenting on the work by the PFRDA, Mr Takru said that the regulatory body has made progress, however, a lot remained to be done. He expressed hope that with statutory powers vested in the body, post the passage of the PFRDA Bill, the Authority would become an effective regulator and a developmental institution... Read more

SEBI issues draft norms for debt shelf offering

Capital market regulator SEBI (Securities and Exchange Board of India) has invited feed back from the public on its proposal to allow certain classes of companies to file ‘shelf’ prospectuses for public issues of non-convertible debt securities.

Comments are invited on the paper latest by December 02, 2013.

The regulator suggested that every issuer will file a prospectus with the registrar of companies before making a public issue. The shelf prospectus must be filed at the time of the first issue and must mention the period of validity, which will not be more than one year... Read more

Domestic News

Infrastructure, banking need Rs. 10.4 trillion bond funding: CRISIL

India’s infrastructure and banking sectors will require Rs. 10.4 trillion from the bond market over the next 5 years, CRISIL said at its second annual bond market seminar.

To facilitate this, greater regulatory focus is required in three areas – deepening of the bond market, developing innovative credit-enhancement mechanisms for infrastructure projects, and building investor appetite for banks’ non-equity capital... Read more

Franklin Templeton’s Bluechip And Prima Funds to complete 20 years

India’s first two private sector mutual fund schemes, Franklin India Bluechip Fund (FIBCF) and Franklin India Prima Fund (FIPF), will soon complete two decades of consistent performance. The two schemes were the first to be launched in December 1993 after the mutual fund industry was thrown open to the private sector.

Speaking on the occasion, Harshendu Bindal President, Franklin Templeton Investments India said, “We are proud that two of our schemes have helped investors achieve their financial goals over the past twenty years... Read more

Birla Sun Life MF launches Banking and Financial Services Fund

Birla Sun Life Asset Management Company Limited, a part of Aditya Birla Financial Services Group (ABFSG), and investment manager for Birla Sun Life Mutual Fund (BSLMF), announced the launch of the Birla Sun Life Banking and Financial Services Fund, an open ended scheme focused on the Indian Banking and Financial Services Sector.

The primary investment objective of the Scheme is to generate long-term capital appreciation to unit holders from a portfolio that is invested in equity and equity related securities of companies engaged in banking and financial services... Read more

Learning

How do SIPs help?
The concept of SIP is similar to recurring bank deposits wherein investors contribute a fixed sum of money at regular intervals.

All market-linked investments go through ups and downs. To create wealth over the long run, a disciplined, far-sighted approach is critical. In this context systematic investment plans (SIPs) can be a preferred option. The concept of SIP is similar to recurring bank deposits wherein investors contribute a fixed sum of money at regular intervals... Read more

International News

Mandatory Provident Fund assets continue to grow amid unpopularity


Assets in Hong Kong's Mandatory Provident Fund (MPF) have more than doubled (up by 117%) since 2008. The fund now accounts for about 63.5% of Hong Kong's retirement investable assets. In contrast, ORSO (Occupational Retirement Schemes Ordinance) assets have stayed flat, and now make up 36.5% of investable assets, compared to 55.3% in 2008.

Despite its asset growth, the MPF remains hugely unpopular in the city, driven by a toxic combination of high fees and low returns. Average fees now are about 1.7%, higher than comparable schemes in Australia (1.21%). Measures to reduce fees have been mooted in Hong Kong, such as implementing fee caps or introducing default funds... Read more

Major gap exists between perception & practice of ethical behavior in financial services

A study released by the Economist Intelligence Unit and sponsored by CFA Institute has shown that although financial services executives overwhelmingly recognize the importance of ethical behavior in the industry, there is still a significant gap between that belief and the industry’s practices. The study, A Crisis of Culture: Valuing Ethics and Knowledge in Financial Services, shows that strengthening culture based around driving integrity and financial knowledge across firms is a priority for the financial services industry.

Despite the importance placed on creating a stronger ethical culture since the financial crisis, a serious disparity still exists when it comes to executives’ recognition that adhering to those higher standards will help earn trust, foster career progress and support financial performance... Read more
 

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