Invest In India » Amc http://investmoneyinindia.com Indian Financial News Resource Wed, 23 May 2012 07:20:15 +0000 en hourly 1 http://wordpress.org/?v=3.3.1 Are Mutual Funds better than stocks? http://investmoneyinindia.com/372/are-mutual-funds-better-than-stocks http://investmoneyinindia.com/372/are-mutual-funds-better-than-stocks#comments Fri, 24 Oct 2008 12:26:00 +0000 Tushar Mathur How safe are Mutual Funds?

Just like any other financial instrument, mutual funds are not without risk. When defined in terms of chances of losing money, the risk in mutual funds is no different than that present in other financial instruments. Still they are relatively safer and a more convenient way on investing.In mutual funds, you can control risk by choosing a fund that suits your risk profile. On the other hand, picking stocks individually that will both meet your objectives and match your profile can be tough.

A mutual fund portfolio is easier to monitor than equity shares. They also come with less systemic risks. They offer quick liquidity. Most private mutual funds can be redeemed in three to four working days. This too cuts the overall risk associated with investing, often not so visible and hence not accounted by many investors. But the market risk or the risk that exists due to economy-wide factors remains. And there is always the possibility that a fund fail to stick to its pre-determined objectives or invests in securities that alter its risk profile. In which case, the blame goes straight to the fund manager and the Asset Management Company (AMC), which manages the mutual fund.

What advantages do mutual funds offer over equity stocks?

Here are a few considerations :

Diversification : Most mutual funds spread the money over a number of shares depending on the fund size. This lowers the risk from an investment loss in a few shares. Even if any one or two shares were to under perform, their impact on the NAV may be only restricted to their proportion of holding. You can't get much diversification from buying equity shares of a company, unless you buy into a conglomerate.

Systematic Investment Plan : Small sums (starting from Rs 500) of money can be invested monthly or quarterly. A plan for systematic withdrawals is also available from some funds.
Easy entry and exit : Filling a mutual fund application or a redemption form, even online, is all that it takes while entering or exiting a mutual fund. But with equity shares, you need an account with a stockbroker (for buying & selling) and another with a depository participant (which maintains your shares in an electronic form). Some investors may find this cumbersome.

Reinvesting dividends : Funds provide for automatic reinvestment of dividends. In India, this facility is not so far available with equity shares.

Tax benefits : Equity linked savings schemes are covered under the overall limit of Rs. 1 lakh under section 80C.

Professional management : When you are investing in a mutual fund, professionals with experience in fund and portfolio management take care after your money. They are also supposed to monitor the economy and the stock markets to change the portfolio accordingly.

"Unless one is ready to dedicate considerable time and effort in stock investing, it is better to invest through the mutual fund route."

©2009 Copyright by Invest In India

]]> How safe are Mutual Funds?

Just like any other financial instrument, mutual funds are not without risk. When defined in terms of chances of losing money, the risk in mutual funds is no different than that present in other financial instruments. Still they are relatively safer and a more convenient way on investing.In mutual funds, you can control risk by choosing a fund that suits your risk profile. On the other hand, picking stocks individually that will both meet your objectives and match your profile can be tough.

A mutual fund portfolio is easier to monitor than equity shares. They also come with less systemic risks. They offer quick liquidity. Most private mutual funds can be redeemed in three to four working days. This too cuts the overall risk associated with investing, often not so visible and hence not accounted by many investors. But the market risk or the risk that exists due to economy-wide factors remains. And there is always the possibility that a fund fail to stick to its pre-determined objectives or invests in securities that alter its risk profile. In which case, the blame goes straight to the fund manager and the Asset Management Company (AMC), which manages the mutual fund.

What advantages do mutual funds offer over equity stocks?

Here are a few considerations :

Diversification : Most mutual funds spread the money over a number of shares depending on the fund size. This lowers the risk from an investment loss in a few shares. Even if any one or two shares were to under perform, their impact on the NAV may be only restricted to their proportion of holding. You can’t get much diversification from buying equity shares of a company, unless you buy into a conglomerate.

Systematic Investment Plan : Small sums (starting from Rs 500) of money can be invested monthly or quarterly. A plan for systematic withdrawals is also available from some funds.
Easy entry and exit : Filling a mutual fund application or a redemption form, even online, is all that it takes while entering or exiting a mutual fund. But with equity shares, you need an account with a stockbroker (for buying & selling) and another with a depository participant (which maintains your shares in an electronic form). Some investors may find this cumbersome.

Reinvesting dividends : Funds provide for automatic reinvestment of dividends. In India, this facility is not so far available with equity shares.

Tax benefits : Equity linked savings schemes are covered under the overall limit of Rs. 1 lakh under section 80C.

Professional management : When you are investing in a mutual fund, professionals with experience in fund and portfolio management take care after your money. They are also supposed to monitor the economy and the stock markets to change the portfolio accordingly.

“Unless one is ready to dedicate considerable time and effort in stock investing, it is better to invest through the mutual fund route.”




©2009 Copyright by Invest In India

]]> http://investmoneyinindia.com/372/are-mutual-funds-better-than-stocks/feed 0 Association of Mutual Funds in India (AMFI) http://investmoneyinindia.com/380/association-of-mutual-funds-in-india-amfi http://investmoneyinindia.com/380/association-of-mutual-funds-in-india-amfi#comments Thu, 16 Oct 2008 05:22:00 +0000 Tushar Mathur With the increase in mutual fund players in India, a need for mutual fund association in India was generated to function as a non-profit organisation. Association of Mutual Funds in India (AMFI) was incorporated on 22nd August, 1995.

AMFI is an apex body of all Asset Management Companies (AMC) which has been registered with SEBI. Till date all the AMCs are that have launched mutual fund schemes are its members. It functions under the supervision and guidelines of its Board of Directors.

Association of Mutual Funds India has brought down the Indian Mutual Fund Industry to a professional and healthy market with ethical lines enhancing and maintaining standards. It follows the principle of both protecting and promoting the interests of mutual funds as well as their unit holders.

The objectives of Association of Mutual Funds in India:

The Association of Mutual Funds of India works with 30 registered AMCs of the country. It has certain defined objectives which juxtaposes the guidelines of its Board of Directors. The objectives are as follows:
This mutual fund association of India maintains a high professional and ethical standards in all areas of operation of the industry.

It also recommends and promotes the top class business practices and code of conduct which is followed by members and related people engaged in the activities of mutual fund and asset management. The agencies who are by any means connected or involved in the field of capital markets and financial services also involved in this code of conduct of the association.

AMFI interacts with SEBI and works according to SEBIs guidelines in the mutual fund industry.

Association of Mutual Fund of India do represent the Government of India, the Reserve Bank of India and other related bodies on matters relating to the Mutual Fund Industry.

It develops a team of well qualified and trained Agent distributors. It implements a programme of training and certification for all intermediaries and other engaged in the mutual fund industry.

AMFI undertakes all India awarness programme for investors inorder to promote proper understanding of the concept and working of mutual funds.

At last but not the least association of mutual fund of India also disseminate informations on Mutual Fund Industry and undertakes studies and research either directly or in association with other bodies.

The sponsorers of Association of Mutual Funds in India

Bank Sponsored

SBI Fund Management Ltd.
BOB Asset Management Co. Ltd.
Canbank Investment Management Services Ltd.
UTI Asset Management Company Pvt. Ltd.

Institutions

GIC Asset Management Co. Ltd.
Jeevan Bima Sahayog Asset Management Co. Ltd.
Private Sector

Indian:-
BenchMark Asset Management Co. Pvt. Ltd.
Cholamandalam Asset Management Co. Ltd.
Credit Capital Asset Management Co. Ltd.
Escorts Asset Management Ltd.
JM Financial Mutual Fund
Kotak Mahindra Asset Management Co. Ltd.
Reliance Capital Asset Management Ltd.
Sahara Asset Management Co. Pvt. Ltd
Sundaram Asset Management Company Ltd.
Tata Asset Management Private Ltd.

Predominantly India Joint Ventures:-

Birla Sun Life Asset Management Co. Ltd.
DSP Merrill Lynch Fund Managers Limited
HDFC Asset Management Company Ltd.
Predominantly Foreign Joint Ventures:-
ABN AMRO Asset Management (I) Ltd.
Alliance Capital Asset Management (India) Pvt. Ltd.
Deutsche Asset Management (India) Pvt. Ltd.
Fidelity Fund Management Private Limited
Franklin Templeton Asset Mgmt. (India) Pvt. Ltd.
HSBC Asset Management (India) Private Ltd.
ING Investment Management (India) Pvt. Ltd.
Morgan Stanley Investment Management Pvt. Ltd.
Principal Asset Management Co. Pvt. Ltd.
Prudential ICICI Asset Management Co. Ltd.
Standard Chartered Asset Mgmt Co. Pvt. Ltd.

Association of Mutual Funds in India Publications

AMFI publices mainly two types of bulletin. One is on the monthly basis and the other is quarterly. These publications are of great support for the investors to get intimation of the knowhow of their parked money.

©2009 Copyright by Invest In India

]]> With the increase in mutual fund players in India, a need for mutual fund association in India was generated to function as a non-profit organisation. Association of Mutual Funds in India (AMFI) was incorporated on 22nd August, 1995.

AMFI is an apex body of all Asset Management Companies (AMC) which has been registered with SEBI. Till date all the AMCs are that have launched mutual fund schemes are its members. It functions under the supervision and guidelines of its Board of Directors.

Association of Mutual Funds India has brought down the Indian Mutual Fund Industry to a professional and healthy market with ethical lines enhancing and maintaining standards. It follows the principle of both protecting and promoting the interests of mutual funds as well as their unit holders.

The objectives of Association of Mutual Funds in India:

The Association of Mutual Funds of India works with 30 registered AMCs of the country. It has certain defined objectives which juxtaposes the guidelines of its Board of Directors. The objectives are as follows:
This mutual fund association of India maintains a high professional and ethical standards in all areas of operation of the industry.

It also recommends and promotes the top class business practices and code of conduct which is followed by members and related people engaged in the activities of mutual fund and asset management. The agencies who are by any means connected or involved in the field of capital markets and financial services also involved in this code of conduct of the association.

AMFI interacts with SEBI and works according to SEBIs guidelines in the mutual fund industry.

Association of Mutual Fund of India do represent the Government of India, the Reserve Bank of India and other related bodies on matters relating to the Mutual Fund Industry.

It develops a team of well qualified and trained Agent distributors. It implements a programme of training and certification for all intermediaries and other engaged in the mutual fund industry.

AMFI undertakes all India awarness programme for investors inorder to promote proper understanding of the concept and working of mutual funds.

At last but not the least association of mutual fund of India also disseminate informations on Mutual Fund Industry and undertakes studies and research either directly or in association with other bodies.

The sponsorers of Association of Mutual Funds in India

Bank Sponsored

SBI Fund Management Ltd.
BOB Asset Management Co. Ltd.
Canbank Investment Management Services Ltd.
UTI Asset Management Company Pvt. Ltd.

Institutions

GIC Asset Management Co. Ltd.
Jeevan Bima Sahayog Asset Management Co. Ltd.
Private Sector

Indian:-
BenchMark Asset Management Co. Pvt. Ltd.
Cholamandalam Asset Management Co. Ltd.
Credit Capital Asset Management Co. Ltd.
Escorts Asset Management Ltd.
JM Financial Mutual Fund
Kotak Mahindra Asset Management Co. Ltd.
Reliance Capital Asset Management Ltd.
Sahara Asset Management Co. Pvt. Ltd
Sundaram Asset Management Company Ltd.
Tata Asset Management Private Ltd.

Predominantly India Joint Ventures:-

Birla Sun Life Asset Management Co. Ltd.
DSP Merrill Lynch Fund Managers Limited
HDFC Asset Management Company Ltd.
Predominantly Foreign Joint Ventures:-
ABN AMRO Asset Management (I) Ltd.
Alliance Capital Asset Management (India) Pvt. Ltd.
Deutsche Asset Management (India) Pvt. Ltd.
Fidelity Fund Management Private Limited
Franklin Templeton Asset Mgmt. (India) Pvt. Ltd.
HSBC Asset Management (India) Private Ltd.
ING Investment Management (India) Pvt. Ltd.
Morgan Stanley Investment Management Pvt. Ltd.
Principal Asset Management Co. Pvt. Ltd.
Prudential ICICI Asset Management Co. Ltd.
Standard Chartered Asset Mgmt Co. Pvt. Ltd.

Association of Mutual Funds in India Publications

AMFI publices mainly two types of bulletin. One is on the monthly basis and the other is quarterly. These publications are of great support for the investors to get intimation of the knowhow of their parked money.

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]]> http://investmoneyinindia.com/380/association-of-mutual-funds-in-india-amfi/feed 0 Religare Aegon gets nod for India mutual fund unit http://investmoneyinindia.com/389/religare-aegon-gets-nod-for-india-mutual-fund-unit http://investmoneyinindia.com/389/religare-aegon-gets-nod-for-india-mutual-fund-unit#comments Fri, 26 Sep 2008 09:59:00 +0000 Tushar Mathur India's stock market regulator has allowed the joint venture between Dutch insurer Aegon and Indian financial services firm Religare Enterprises to start fund operations, a top executive said.

'We have got our approval,' Saurabh Nanavati, chief executive of Religare Aegon (nyse: AEG - news - people ) Asset Management, told Reuters on Thursday.

'Next week we will file for the first offer document and are looking at a launch in November,' he added.

Nanavati said his firm would launch at least seven funds in the first year of operations and plans to have 15 branches at the time of the launch and 30 in over 25 cities by March 2009.

The firm joins the likes of French insurer AXA, JPMorgan, South Korea's Mirae Asset and Edelweiss Capital who have started operations in the fiersely competitive Indian asset management industry in the last 18 months.

'Over the next 2-3 years, the AMC will focus on creating wide reach across India especially in Tier II and Tier III cities, with an initial target of opening at least 100 branches in the first two years of operations,' Nanavati said.

The Indian fund industry has 35 members, who managed about 5.4 trillion rupees ($118 billion) at the end of August, data from the Association of Mutual Funds in India showed.

©2009 Copyright by Invest In India

]]> India’s stock market regulator has allowed the joint venture between Dutch insurer Aegon and Indian financial services firm Religare Enterprises to start fund operations, a top executive said.

‘We have got our approval,’ Saurabh Nanavati, chief executive of Religare Aegon (nyse: AEG – news – people ) Asset Management, told Reuters on Thursday.

‘Next week we will file for the first offer document and are looking at a launch in November,’ he added.

Nanavati said his firm would launch at least seven funds in the first year of operations and plans to have 15 branches at the time of the launch and 30 in over 25 cities by March 2009.

The firm joins the likes of French insurer AXA, JPMorgan, South Korea’s Mirae Asset and Edelweiss Capital who have started operations in the fiersely competitive Indian asset management industry in the last 18 months.

‘Over the next 2-3 years, the AMC will focus on creating wide reach across India especially in Tier II and Tier III cities, with an initial target of opening at least 100 branches in the first two years of operations,’ Nanavati said.

The Indian fund industry has 35 members, who managed about 5.4 trillion rupees ($118 billion) at the end of August, data from the Association of Mutual Funds in India showed.




©2009 Copyright by Invest In India

]]> http://investmoneyinindia.com/389/religare-aegon-gets-nod-for-india-mutual-fund-unit/feed 0 Advantages and Disadvantages of ETFs http://investmoneyinindia.com/194/advantages-and-disadvantages-of-etfs http://investmoneyinindia.com/194/advantages-and-disadvantages-of-etfs#comments Sun, 24 Aug 2008 15:03:17 +0000 Tushar Mathur http://investmoneyinindia.com/?p=194 ©2009 Copyright by Invest In India

]]> This is the 2nd installment of our 2 part series on ETFs. Please read the first part here: Investing in ETFs

Advantages of ETFs

1. ETFs tend to be more cost-effective vis-a-vis comparable mutual funds. For instance, while the expense ratio of a passively managed ETF (tracking a benchmark index) would normally be in the range of 0.50%-1.00%; for an index fund, it can be as high as 1.50%.

2. Another important advantage with ETFs is that they provide more flexibility to investors than regular mutual funds. Since they are traded on the stock exchange, they are available to investors any time during the trading hours. So investors can buy and sell units of an ETF on a real time basis, unlike regular mutual funds, which can be transacted only at end-of-day NAV.

3. Since ETFs witness most of the buying/selling on the exchange, the interests of the long-term investor are not compromised. Take a regular equity fund where units are bought and sold at the AMC’s end – when a significant amount of money enters and exits the fund rather quickly, the long-term investor could suffer as a result of the costs (trading costs, registrar costs and opportunity loss, if the fund manager is forced to sell his best stocks) associated with this quick inflow/outflow.

With an ETF, since the trading investor does not approach the AMC at all and only interacts with other investors over the exchange, his quick entry/exit does not compromise the interests of the long-term investor.

4. Given ETFs are traded on the stock exchange, and can be bought/sold on a real time basis; they tend to have low tracking error (deviation of ETF’s performance from that of the underlying index) as compared to index funds.

Disadvantages of ETF

1. Investors need to have a demat and a trading account, with a SEBI registered stockbroker, for investing in ETFs. For investors, who do not trade in stocks, this could be a bit of a deterrent. Also, maintaining a demat account entails paying annual fees (approximately Rs 500), however the same varies across stockbrokers. For investors, who invest in stocks, this will not pinch as the maintenance charge of the demat account will be spread across the stock and ETF investments.

2. While investors have to incur entry/exit loads at the time of making/redeeming investments in mutual funds, for ETFs they have to pay a brokerage (usually around 0.50%) to the stockbroker, along with other applicable charges (STT for instance), every time ETF units are bought or sold. For a trader who frequently trades, this can have a significant impact on the net returns. But for long-term investors, these expenses hold little relevance.

What investors must do
It is evident that ETFs offer a different investment proposition vis-à-vis conventional mutual funds. ETFs may appeal to investors who want to track the performance of a particular benchmark index (such as S&P CNX Nifty or BSE Sensex); Similarly, the ETF route can also appeal to investors who are desirous of investing in asset classes such as commodities (e.g., gold), or even REITs (e.g., international real estate and homes). The allure of ETFs will only grow given the expanding bouquet of offerings.

Investors on their part would do well to thoroughly understand the pros and cons of ETFs; this will help them make informed investment decisions. Also, investors must consult their investment advisors/financial planners to determine the suitability of an ETF in their investment portfolios.

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