Beruflich Dokumente
Kultur Dokumente
A Mutual Fund is a trust that pools the savings of a number of investors who share a common investment objective
IN turn buy assets
LEGAL STRUCTURE
FUND SPONSPOR/SETTLOR KOTAK MAHINDRA FINANCE LTD.
TRUST KOTAK MAHINDRA MUTUAL FUND TRUSTEE KOTAK MAHINDRA TRUSTEE CO. LTD. UNIT HOLDERS INVESTMENT MANAGER & ADVISOR KOTAK MAHINDRA ASSET MANAGEMENT CO. LTD.
Contd
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LEGAL STRUCTURE
INVESTMENT MANAGER & ADVISOR KOTAK MAHINDRA ASSET MANAGEMENT CO. LTD.
BANKS
DISTRIBUTORS
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FUND MANAGEMENT
Generate
Invest in
SECURITIES
Index Schemes
Sectoral Schemes
Balanced Funds
Money Market Funds
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MUTUAL FUNDS
OPEN ENDED OPEN FOR ALL THE YEAR MIN SUBS AMT 50CR NO DURATION REFUNDED IF MIN SUBS NOT ACHIEVED REPURCHASED ANY TIME REDEEMED AT NAV & LOAD FACTOR RANGES (4% TO 6%) AS REPURCHSED SO NOT LISTED AT STOCK EX TRADED AS PERMITTED LOT DIVID MAY /MAY NOT SWITCHOVER ALLOWED 21-6
CLOSE ENDED OPEN FOR FIXED PERIOD MIN SUBS AMT 20CR DURATION (5TO7 YEARS) REFUNDED IF MIN AMT NOT ACHIEVED MAY BE REPURCHASED (AFTER 2 TO 3 YRS) REDEMPTION SPECIFIED & DONE AT NAV - SERVICE CHARGE LISTED AT STOCK EX DIVID MAY/MAY NOT BE SWITCHOVER Prof. A.K. .Mishra All rights reserved ALLOWED Copyright 2002 by
Park
surpluses
Short
Easy Tax
term investment
liquidity
Profile Select
your risk
benefits
Mix
Invest
regularly/with flexibility
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Management & Analysis Diversification & Divisibility Across Companies & Sectors Liquidity Entry & Exit at NAV Transparency Regular disclosures Convenient Administration (Record Keeping) Low Costs of operations (Lower transaction cost) Choice of schemes. Well Regulated. (By SEBI)
INVESTMENT OPTIONS
Instrument
Bank Deposits
ICDs Call (thro PDs) T-Bills
Tenure
7 days to 1 yr.
<180 days Overnight <12 months
Pre-Tax Returns
6% - 12%
9% - 11% 6.5% - 9% 7% - 9%
Risk
Low
Medium Low Price Risk
Liquidity
Possible by breaking FD at cost
No secondary mkt. Routed thro PDs High
Mutual Funds
Liquid Bond Serial Overnight to 1 month 1 month 12 months Over 1 year 8% to 9.5% 9% 10.5% 9% - 10% No Low Credit No price risk High High High
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Receive dividend within 30 days of their declaration, receive redemption proceeds within 10 days from the date of the valid redemption
Vote in accordance with the Regulations to: - change the Asset Management Company - wind up the schemes. To receive communication from the Trustee about change in the fundamental attributes of any scheme
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MUTUAL FUNDS
STRUCTURAL ISSUES (MUTUAL FUNDS)
MUTUAL FUND (REGISTERED WITH SEBI) MEANS: A FUND ESTABLISHED IN THE FORM OF TRUST
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MUTUAL FUNDS
STRUCTURAL ISSUES (MUTUAL FUNDS)
BY A SPONSOR
BODY CORPORATE WHO ACTING ALONE OR IN COMBINATION WITH ANOTHER BODY CORPORATE FLOATS THE IDEA OF SETTING UP OF MUTUAL FUND ESTABLISHES MUTUAL FUND IN FORM OF TRUST
MUTUAL FUNDS
FOR INVESTING IN SECURITIES APPLICATION FEES:5000; REGISTRATION FEES:10 LACS; ANNUAL FEES : 1 LAC
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MUTUAL FUNDS
STRUCTURAL ISSUES(MUTUAL FUND TRUST)
50% MEMBERS NOT AFFILIATED WITH SPONSORS CONTROLS ALL CAPITAL PROPERTY OF MF SCHEMES/ HOLDS THEM IN TRUST FOR HOLDERS
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MUTUAL FUNDS
STRUCTURAL ISSUES(MUTUAL FUND TRUST)
APPOINTS AMCs
ENSURES SCHEMES FLOATED & MANAGED BY
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MUTUAL FUNDS
STRUCTURAL ISSUES (MUTUAL FUND TRUST LIST) ALLIANZ CAPITAL & MGT SERVICES LTD ANZ GRINDLAYS BANK TIMES MUTUAL FUNDS UNIT TRUST OF INDIA VLS FINANCE LTD. KOTAK MAHINDRA FINANCE LTD PRUDENTIAL CAPITAL MARKETS LTD. SBI FUNDS MANAGEMENT LTD CEAT MF & ASSET MANAGEMENT COMPANY LTD.
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MUTUAL FUNDS
STRUCTURAL ISSUES (AMC)
MFs OPERATED BY AMCs -APPTD BY TRUSTEES AMCs & TRUSTEES TWO SEPARATE LEGAL
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MUTUAL FUNDS
STRUCTURAL ISSUES (AMC)
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MUTUAL FUNDS
STRUCTURAL ISSUES (AMC LIST) 20TH CENTURY AMC LTD APPLE ASSET MGT LTD. BOI AMC LTD. CREDIT CAPITAL AMC LTD. GIC AMC LTD. ICICI AMC LTD. ITC PIONEER AMC LTD. MORGAN STANLY AM INDIA LTD. PNB AMC LTD.
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MUTUAL FUNDS
STRUCTURAL ISSUES (INVESTMENT MIX) EQUITY SHARES/EQUITY RELATED INSTRTS (CDs)/ DEBT INSTRUMENTS (NCDs, PSBONDS,GOVT SECT)/MONEY MARKET INSTRTS(TBs, CPs & BILLS) 5% CAP FROM ONE SCHEME IN ONE COS SHARE 10% CAP FROM ALL SCHEMES IN ONE COS SHARE 15%CAP FROM ALL SCHEMES IN ONE INDUSTRY
DEBT 5-20% 60-70% 40-50% MONEY MKT 0-10% 0-15% 0-10%
TYPICAL ASSET MIX SCHEME EQUITY GROWTH 70-90% INCOME 20-30% BALANCED 40-60%
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NAV=
MARKET PRICE: IN CASE OF CLOSE ENDED REPURCHASE/REISSUE PRICE: OPEN ENDED DISCOUNT RATE OF RETURN= NAV AT END-NAV AT BEGINNING +
DIVIDEND PAID NAV AT BEGINNING
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INITIAL ISSUE EXP (6% OF FUND RAISED)HIDDEN RECURRING EXP (3% MAX OF NET ASSETS) OTHER THAN INITIAL ISSUE EXP/ INCLUDES TRUSTEESHIP FEES /INCLUDES INVST MGT &
AMC CHARGE FOR ISSUE/RECURRING COST(6%) IN OPEN END SCHEME DIFF BETWEEN PURCHASE & SALE PRICE NOT TO EXCEED 7% OF SALE PRICE
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IF VALUE OF EQUITY IS DOUBLED, NAV SHIFTS NAV=(RS 12 MILL EQ + RS 4 MILL DEBT)- 2 MILL LIAB AS DEBT = 0.875
16 MILL UNITS IN TRUST
IF VALUE OF EQUITY IS HALFED THEN THE NEW NAV IS NAV=(RS 3 MILL EQ + RS 4 MILL DEBT)- 2 MILL LIAB AS DEBT = 0.3125
16 MILL UNITS IN TRUST
IN ABOVE, FUND SHOULD SWITCH FROM AGGRESSIVE TO DEFENSIVE INVEST TO AVOID RAPID EROSION OF NAV INVEST IN DEBT INSTRTS MAY BE ONE SOLUTION
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DIFFRENCE BETWEEN OFFER & BID PRICE IS 4% i.e. 80 PAISE IS CALLED SPREAD PAID TO FUND
THERE IS A TWO WAY QUOTE PROVIDED BY IN OPEN FUND
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KEY FINANCIALS MARS, PVT SECTOR MF LAUNCHED A GROWTH SCHEME WITH AN INITIAL TARGET OF Rs 100 CR. DEPLOYMENT OF FUNDS IS TO CONFIRM THE FOLLOWING COMPOSITION EQUITY 70%, DEBT 25% MONEY MARKET 5% INITIAL EXPENSES 4% DEBT COMPONENT INVESTED EQUALLY IN AAA & AA RATED INSTRUMENTS AT 18% & 20% RESPECTIVELY EQUITY PORTION INVESTED IN SENSEX SCRIPS AV. YIELD ON MONEY MARKET COMPONENT WAS 8% SENSEX WAS AT 3800 & AT TIME OF INVEST IS AT 2900 AFTER ONE YEAR DEBT & MONEY MKT INSTRTS VALUED AT COST RECURRING EXP MET OUT OF INCOME EARNED ON DEBT & MONEY MKT INSTRTS (assume 3% on size of fund)
COMPUTE NAV & SALE PRICE IF FRONT LOAD FACTOR IS 5%
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FEW EVIDENCES SHRIRAM ASSET MGT CO FINED (JUN 96) MORGAN STANLEY FINED (2/6/97)
RESORTING TO SHORT SALES PRICE RIGGING IN BHEL SCRIPS RENDERING PORTFOLIO MGT SERV TO GROUPS
CANSTAR UNABLE TO PURCHASE AT PROMISED NAV LIC MF HAD TO PURCHASE AT PROMISED NAV & BOOK THE LOSS TO AMC
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No. of Schemes Schemes giving -ve returns on annualised basis Schemes giving single digit annualised returns Schemes giving double digit annualised returns Source: Business Today
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98 50 31 17
28 01 10 17
32 02 12 18
158 53 53 52
10,285 3,172
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INVESTORS SERVICE
THE CHAIN OF OPERATION
PRODUCT DESIGN
PRODUCT MARKETING
OUT SOURCING
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FUND MANAGEMENT
ADAPATABILITY
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PRODUCT DESIGN DID LITTLE TO INNOVATE WITH INNOVATION 70% SCHEMES CLOSE END WITH POOR RETURNS UTI STILL CONTINUES WITH PLAIN VANILLAS INNOVATION ONLY IN OPEN END SCHEMEDS TIME TO DESIGN SECTOR, LOCATION BASED MFs
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PRODUCT MARKETING COST & ETHICS ARE TWO IMPORATNT FACTORS UPFRONT COST BORNE BY INVESTOR OR AMC UTI CANT AGGRESSIVELY MARKET ITS PRODUCT MORGAN STANLEY MADE MFs AS IPOs & ALL NUANCES OF IPOs WERE BROUGHT IN
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FUND MANAGEMENT NON-QUALIFIED, UNPROFESSNL FUND MANAGERS LOOK MFs AS ANOTHER EQUITY PRODUCT IGNORE ASSET ALLOCATION, PORTFOLIO, TURNOVER & COST NO QICK ASSET REALLOCATION ON TIME DONT INCLUDE HIGH LIQUID BLUE CHIP STOCKS NOT BALANCING RISK RETURN EXPECTATION OF INVESTORS
21-39
FUND MANAGEMENT- SUGGESTED MODEL PROTECT CAPITAL FROM EROSION ALTERNATIVELY GUARANTEE CAPITAL SAFETY POSSESS EXCELLLENT RESEARCH CAPABILITIES TO ENSURE MARKET TIMING INVESTMENT STRATEGY FORMULATION FOLLOW APPROPRIATE ASSET ALLOCATION MODEL SUITING FUNDS OBJECTIVE QUICKLY RESTRURE ASSET ALOCATION ON NEED ENSURE QUALITY OF ASSETS BE IT EQTY OR DEBT ENSURE ECONOMICAL COST OF OPERATIONS BE IT MANAGEMENT FEES OR OTHER EXPENSES
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OUTSOURCING NEW CONCEPT THAN TO DO THINGS IN HOUSE ENDORSED AS A GREAT COST CUTTING MEASURE CONVERTS FIXED COSTS TO VARIABLE COSTS ABROAD OUTSOURCING 100% FROM PRODUCT DESIGN TO INVESTOR SERVICING YET TO COME IN INDIAN FUND MANAGEMENT ONE AREA MAY BE DISTRIBUTION NETWORK
21-42
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CUSTOMER FOCUS SCANT ATTENTION TO INVESTORS SERVICING IGNORING INVESTORS EDUCATION NOT INCLINED TOWARDS TRANSPARENCY NON DISCLOSURE OF PORTFOLIO LACK LUSTER SHOW ON RETURNS FRONT UNIT HOLDERS NOT TREATED AS CUSTOMERS GOOD SERVICE ATTRACTS MULTIPLE CUSTOMERS MORALE TREAT HIM LIKE CUSTOMER & INVEST IN TECNOLOGY TO REACH HIM FAR & WIDE LESSONS TO LEARN FROM Pvt SECTOR MFs
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