Investors keen on mid and smallcap stocks but wary of volatility should consider multicap equity schemes over standalone midcap or smallcap schemes.
Some historical evidence on why sector funds cannot form the core of your portfolio.
A strong influx of 11 equity new fund offers (NFOs) in June, particularly within the thematic space, helped mutual funds collect Rs 14,370 crore - the highest ever via such introductory offers. This surpassed the previous high recorded in July 2021, where four NFOs accumulated Rs 13,709 crore, with ICICI Prudential MF's flexicap NFO alone mobilising Rs 9,808 crore.
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.
'MFs acted as reckless lenders and not as prudent investors.' 'Clearly, how debt funds are being run is a systemic issue,' warns Debashis Basu.
'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.'
They are making switch to the high-growth alternative investments fund industry, reports Pavan Burugula.
Capital markets regulator Sebi has amended norms to bring buying and selling of mutual fund units under the ambit of insider trading rules. At present, insider trading rules are applicable to dealing in securities of listed companies or those proposed to be listed, when in possession of Unpublished Price Sensitive Information (UPSI). The units of mutual funds are specifically excluded from the definition of securities under the rules.
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.
Nine lenders have exposure to the promoter entities and had taken listed operating companies' shares as collateral from the promoter companies.
In fact, the current market scenario provides more value investment opportunities. So, it is positive for mutual funds.
'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.'
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.
Gold funds have returned -5.2 per cent, while the Sensex is down 7 per cent in the past year.
Tata Mutual Fund's 'own a piece of India' offering is suitable for informed investors.
After Chanda and Deepak Kochchar, the Kudvas are the second power couple in the financial world to come under the regulatory glare.
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.
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.
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.
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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.
Among individual fund houses, SBI MF was the biggest gainer in absolute terms; its AAUM rose Rs 66,090 crore, compared to its asset base in the corresponding period of FY18, reports Jash Kriplani.
Last October's circular meant that downstream investment by such funds by way of subscription or acquisition of shares would have been considered "indirect foreign investment" if their investment manager or sponsor is owned or controlled by a non-resident. The finance ministry has now said that mutual funds that invest more than 50 per cent in equity shall be omitted from the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996.
While an impending rate cut is a good reason to enter debt funds, another is the high valuations in equity markets.
'Investors should do proper analysis before putting in their money in NFOs as most new launches are in the high-risk thematic space.'
Omkeshwar Singh, Head, Rank MF, a mutual fund investment platform, answers your queries.
The company has a market capitalisation of $743 billion.
About 24 fund houses saw a decline in their debt AUMs in the past one year.
rediffGURU Ulhas Joshi answers readers' mutual fund queries
There is so much liquidity in the system, in the global economy, and that's why the stock market is very buoyant. It will certainly witness correction in the future: RBI's Das.
'Those satisfied with returns and not expecting further rally could be booking profits and also stopping SIPs.'
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.
Don't exit from growth-style funds as they may benefit next from a shift in investor preference.
Most large fund houses, such as HDFC MF, ICICI Prudential AMC, Reliance MF, Reliance MF, Birla SunLife MF and SBI MF, have the backing of large banks or financial institutions, giving them reach and understanding, they say.
Mutual fund houses hold Rs 3,400 crore of Yes Bank's 'riskier' bonds. Reliance MF, Franklin Templeton MF and UTI MF account for bulk of these exposures.
Market watchers believe that the change in guidelines fly in the face of some of the recent initiatives taken by the government, such as easing norms for foreign portfolio investors.
The SIP route suits the salaried class, by matching their income flows with investment frequency.
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