Monday, November 23, 2009

MFs on stock exchanges: fund houses strategise

Market regulator SEBI’s proposal to allow mutual funds (MFs) to trade on recognised exchanges through brokers has asset management companies thinking up necessary strategy changes.

Firms such as India Infoline are planning to merge the MF sales vertical with broking business. “This will help us serve our customers better with one relationship manager being the interface of the customer for all the products including mutual fund,” said Nirmal Jain, Chairman and Managing Director of India Infoline group.

Experts foresee that MF schemes are likely to turn from marketing or sales-driven products to performance-driven ones. AMCs would have to draw up new strategy to get investor attention, they felt.

There is also a question on whether SEBI (Securities and Exchange Board of India) would allow investors to hold both stocks and MFs in the same demat account.

AMCs will be able to survive — even thrive --- if they are able to generate a critical mass of assets under management. This will happen when investors benefit, said experts.

“MF units cannot be traded based on price movements, like stocks. They would have to be based on Net Asset Value (NAV) at the close of market. This would put the onus on performance of MFs and not just the marketing push. This would benefit investors a lot,” said Sandip Sabharwal, chief executive officer --- portfolio management services of Prabhudas Lilladher.

“Within 2-3 months, SEBI will issue guidelines. The guideline will also clarify whether NAV can be changed during the course of the day. But if we have to imagine from the current system then for a day mutual fund schemes will keep the prices fixed for buying and selling,” said Jain.

Meanwhile, not all fund houses are gung-ho about the proposal. “We are unsure what SEBI has in mind and how it would be implemented. We are waiting for further clarity on the issue before we can form any concrete strategy,” said the spokesperson of a leading securities firm, not wanting to be named.

No comments:

Just click away from joining most active Mutual Fund India google group

Google Groups
Subscribe to Mutual Fund india
Email:
Visit this group

Aggrasive Portfolio

  • Principal Emerging Bluechip fund (Stock picker Fund) 11%
  • Reliance Growth Fund (Stock Picker Fund) 11%
  • IDFC Premier Equity Fund (Stock picker Fund) (STP) 11%
  • HDFC Equity Fund (Mid cap Fund) 11%
  • Birla Sun Life Front Line Equity Fund (Large Cap Fund) 10%
  • HDFC TOP 200 Fund (Large Cap Fund) 8%
  • Sundram BNP Paribas Select Midcap Fund (Midcap Fund) 8%
  • Fidelity Special Situation Fund (Stock picker Fund) 8%
  • Principal MIP Fund (15% Equity oriented) 10%
  • IDFC Savings Advantage Fund (Liquid Fund) 6%
  • Kotak Flexi Fund (Liquid Fund) 6%

Moderate Portfolio

  • HDFC TOP 200 Fund (Large Cap Fund) 11%
  • Principal Large Cap Fund (Largecap Equity Fund) 10%
  • Reliance Vision Fund (Large Cap Fund) 10%
  • IDFC Imperial Equity Fund (Large Cap Fund) 10%
  • Reliance Regular Saving Fund (Stock Picker Fund) 10%
  • Birla Sun Life Front Line Equity Fund (Large Cap Fund) 9%
  • HDFC Prudence Fund (Balance Fund) 9%
  • ICICI Prudential Dynamic Plan (Dynamic Fund) 9%
  • Principal MIP Fund (15% Equity oriented) 10%
  • IDFC Savings Advantage Fund (Liquid Fund) 6%
  • Kotak Flexi Fund (Liquid Fund) 6%

Conservative Portfolio

  • ICICI Prudential Index Fund (Index Fund) 16%
  • HDFC Prudence Fund (Balance Fund) 16%
  • Reliance Regular Savings Fund - Balanced Option (Balance Fund) 16%
  • Principal Monthly Income Plan (MIP Fund) 16%
  • HDFC TOP 200 Fund (Large Cap Fund) 8%
  • Principal Large Cap Fund (Largecap Equity Fund) 8%
  • JM Arbitrage Advantage Fund (Arbitrage Fund) 16%
  • IDFC Savings Advantage Fund (Liquid Fund) 14%

Best SIP Fund For 10 Years

  • IDFC Premier Equity Fund (Stock Picker Fund)
  • Principal Emerging Bluechip Fund (Stock Picker Fund)
  • Sundram BNP Paribas Select Midcap Fund (Midcap Fund)
  • JM Emerging Leader Fund (Multicap Fund)
  • Reliance Regular Saving Scheme (Equity Stock Picker)
  • Biral Mid cap Fund (Mid cap Fund)
  • Fidility Special Situation Fund (Stock Picker)
  • DSP Gold Fund (Equity oriented Gold Sector Fund)