After the Franklin Templeton episode, investor confidence has been shaken. Known brands have become more relevant to investors, as long as this psychological impact lasts.
Your AMC shuts shop. Panic? Wait. What happens next isn't what most fear.
At these high levels, remaining invested in the market is the best bet for small investors, says Ramesh Shrichand Damani.
Chief Investment Officer of Prudential ICICI, Nilesh Shah discusses the current situation of the market in terms of inflows, valuations and the general consensus on the market.
When evaluating bonds, returns shouldn't be the sole factor. Pay close attention to the bond's credit rating. It should ideally be AA or higher.
'Looking at the speed at which changes were made post the Franklin Templeton issue, we are awaiting more stricter norms in the months to come.'
Several mutual funds (MFs) have recently approached the Reserve Bank of India (RBI) as they renew efforts to increase their overseas investment limit. In June 2022, the capital markets regulator Securities and Exchange Board of India (Sebi) permitted MFs to invest in foreign stocks within the aggregate mandated limit of $7 billion after a correction in stocks. One of the proposals shared with the RBI is to link MFs' foreign investment limit to the country's foreign exchange reserves.
'MFs acted as reckless lenders and not as prudent investors.' 'Clearly, how debt funds are being run is a systemic issue,' warns Debashis Basu.
Monitor how long the high cash position lasts. If it lasts for a month or two, it is fine. But if it continues for a couple of quarters, seek your advisor's opinion on whether to exit the fund.
When looking at fund returns, avoid looking at just the past 12 months' performance, says Sanjay Kumar Singh
If you don't have enough time to study the market, go for mutual funds, says personal finance expert Rahul Goel.
By contrast, the fraud enabled Raju's kin and aides to make hundreds of crores, charges CBI.
The Indian markets have risen 5.2 per cent in the last five days, but Mobius, who has one of the largest exposures to India among Brazil, Russia, India, China (BRIC) countries, says he cannot say the correction is over in the Indian markets.
Investors keen on mid and smallcap stocks but wary of volatility should consider multicap equity schemes over standalone midcap or smallcap schemes.
In a statement, the central bank said heightened volatility in capital markets in reaction to Covid-19 has imposed liquidity strains on mutual funds (MFs), which have intensified in the wake of redemption pressures related to closure of some debt MFs and potential contagious effects therefrom.
'We know that returning money to unitholders at the earliest is the first and most important step towards resurrecting our brand and regaining investor trust.'
Distressed by the falling spree of Indian equities, fund managers are looking at various avenues of diversification. At a time when emerging markets, including India, are vulnerable to global cues and are more coupled, frontier markets showless or almost no correlation. Franklin Templeton was the first to spot an opportunity and has already filed for a MENA fund (Middle East North Africa Fund), which will invest in some of the frontier markets.
Bajaj Finance was the top laggard in the Sensex pack, dropping over 9 per cent, followed by Axis Bank, IndusInd Bank, HDFC, ICICI Bank and M&M. Reliance Industries, however, capped the losses by rallying over 3 per cent. Sun Pharma, Hero MotoCorp, L&T, PowerGrid and Bajaj Auto were also among the gainers.
Some historical evidence on why sector funds cannot form the core of your portfolio.
'India is an equity market with a breadth and depth of companies to invest in.'
'The shifts in US involvement in global conflicts and geopolitical alliances could introduce uncertainties.'
Floating-rate mutual funds are back in demand after a year-long period of consistent outflows. In the past three months, investors have poured over Rs 6,100 crore into these debt schemes, indicating a reversal in fortunes for the category that recorded outflows for 11 consecutive months (May 2022 to March 2023), totalling Rs 32,250 crore. Floating-rate funds invest at least 65 per cent in floating-rate instruments, which have their interest rates linked to the Reserve Bank of India repo rate.
After Chanda and Deepak Kochchar, the Kudvas are the second power couple in the financial world to come under the regulatory glare.
Flipkart Group on Monday said it has raised $3.6 billion (about Rs 26,805.6 crore) in funding led by GIC, Canada Pension Plan Investment Board (CPP Investments), SoftBank Vision Fund 2 and Walmart, valuing the e-commerce giant at $37.6 billion. The company, which competes with Amazon, Reliance Industries' JioMart and others in the burgeoning Indian e-commerce market, said it will continue to make deeper investments across people, technology, supply chain and infrastructure to address the requirements of a rapidly growing consumer base in the country. The current funding round has also seen participation from sovereign funds DisruptAD, Qatar Investment Authority, Khazanah Nasional Berhad as well as marquee investors Tencent, Willoughby Capital, Antara Capital, Franklin Templeton and Tiger Global.
Over the past 25 years the MF industry has come a long way. Geographic reach has increased, many more customers have been added, more channels have been opened up and the product basket is full.
'Investors should do proper analysis before putting in their money in NFOs as most new launches are in the high-risk thematic space.'
'Investors looking at the next 6-12 months can be certain that the Fed will maintain its easing cycle, and we expect the overall environment to be conducive for fixed income investments for portfolio diversification.'
Small and midcap schemes may impose restrictions on redemptions, cap employee withdrawals, and increase the exit load, while ensuring a proportionate liquidation of the portfolio during market crises to safeguard the interests of all investors. These measures have been outlined in the investor protection policies recently put out by mutual fund (MF) trustees. The policies for small and midcap schemes were prepared by MF trustees following directives from the Securities and Exchange Board of India (Sebi) earlier this month.
Nine lenders have exposure to the promoter entities and had taken listed operating companies' shares as collateral from the promoter companies.
They are making switch to the high-growth alternative investments fund industry, reports Pavan Burugula.
FIPB had taken up these three proposals in its meeting in August, but the decision on them was kept in abeyance.
The contribution from asset management companies (AMCs) has surpassed the Rs 3,000 crore target for the creation of a Rs 33,000 crore backstop facility for debt mutual funds (MFs). The initial corpus for the Corporate Debt Market Development Fund (CDMDF) is nearly Rs 3,100 crore, according to multiple government officials and AMC executives. "The fund is operational now. "The required corpus has been raised by AMCs and the remaining part (Rs 30,000 crore) is in the form of a guarantee from the government which will be activated only in case of a credit event," explained D P Singh, joint CEO and deputy MD, SBI MF.
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The market regulator is wielding an unprecedented level of control over how mutual funds operate, delaying new launches and dictating investment strategy, frustrated insiders in the embattled industry say.
The improving outlook for the power sector has caught the interest of dividend yield funds. In the first four months of the current financial year (2023-24, or FY24), five of the six largest dividend yield funds have shown a notable increase in their exposure to stocks within the power sector. Some have even introduced new stocks to their portfolios.
Omkeshwar Singh, Head, Rank MF, a mutual fund investment platform, answers your queries.
Once you follow these, it is also important to deploy your savings in inflation-beating investment avenues.
Investors in international funds should have a horizon of more than five years. Not only will this help them overcome equity and currency volatility, it will also help them enjoy better tax treatment, says Sanjay Kumar Singh.
