Consolidated MF statements soon

Single consolidated statement of mutual fund (MF) holdings will soon become a reality for MF investors. This, in other words, would mean MF investors holding MF units in different fund houses will soon be able to get one single statement. Market regulator Securities and Exchange Board of India (Sebi) has apparently asked all the registrar and transfer agents (RTAs) to club investor data together. Computer Age Management Services (CAMS), Karvy MF Services, Deutsche Investor Services and Franklin Templeton today provide RTA services to the mutual fund industry.

“This was an expected move from Sebi given that in a recent summit,” Sebi executive director KN Vaidyanathan had hinted on introducing the single view statement. “We are planning to put in place a mechanism where the investor will get a single view of their investments,” he said. CAMS president & CEO NK Prasad said, “We are working on it for a long time, but we haven't received any final approval from the regulator. Some of the issues are being discussed and we hope it will be sorted out.”

If implemented, this move will be of immense benefit to MF investors. Today there are operational issues that a mutual fund investor has to grapple with. For instance, an investor is given multiple folio numbers, for investing in different schemes and fund houses. And over the years, he accumulates multiple folios which he can't keep track of. And usually, at the end of the financial year, multiple mails of fund houses hound him with statements informing cost of your units and its current NAV. In the process, investor lose track of his investments. Some fund houses are also known to smartly ignore investors who they categorise as 'dormant' and don't communicate to them.

Market sources expect such platform for single view statement to be ratcheted up in next one month or so. Recently, National Securities Depository (NSDL) had started a similar facility for holding mutual fund units in dematerialised form. But the Sebi initiative, is more awaited as it is likely to come at zero cost for investors.

Source: http://www.financialexpress.com/news/consolidated-mf-statements-soon/647111/

Industry witness rise in folios

Total Assets Under Management (AUM) of Mutual Fund (MF) industry fell 15.20% or Rs 1.12 lakh crore to Rs 6.30 lakh crore in June 2010. This has been the second consecutive month the industry has faced fall in total assets. Total AUM of equity funds had increased 3.86% to Rs 1.78 lakh crore in June as equities turned out to be favorable. BSE Sensex and S&P CNX Nifty had risen 4.46% and 4.45% respectively in June 2010, compared to a loss of 3.50% and 3.63% respectively in May 2010.

The weightage of equity funds increased to 28% of the total assets of the industry in June as against 23% in May. However, this category had a net outflow to a tune of Rs 1446 crore in June as against net inflow in May. Withdrawal by banks and corporates had been the major reason for the decline in assets in June. Banks had withdrawn from schemes to lend it to 3G and BWA bidding. On the other hand, the corporates had withdrawn their money to meet their advance tax payment commitments.

Similarly, equity folios (representing the number of investor accounts) of mutual funds saw a sharp decline of over 1.47 lakh in June. Investors seem to be redeeming equity fund units on the back of rising equity markets and uncertainty over its direction, going forward. The fall in equity folios can be attributed to the fact that investors were moving away from the equity markets. Total equity folios stood at 4.05 crore in June as compared to 4.07 crore in May. However, total folios (including debt and others) saw a marginal increase of 21,350 and were at 4.79 crore in June with most new folios coming into debt schemes. The income/debt schemes folio increased by 190287 in June over May or by 4.92%. In the previous six months (between November to May-end), the number of folios rose a mere 49,153, which in context to June rise of 21,350, clearly show the rising interest of investors in mutual funds.

Fund house wise, the investors gave highest preference to UTI Mutual Fund. The country's oldest fund house in terms of assets crossed the 10-million mark. It also added the largest number of folios–1.18 lakh in June compared to the month of May, when its folio size reduced by 32788. DSP BlackRock Mutual Fund followed it by adding 44821 folios. IDBI AMC and HDFC added more than 20,000 extra folios in June. Peerless contributed zero folios in month of June, whereas SBI Mutual Fund folios fell the most by 49161.

Source: http://www.apollosindhoori.cmlinks.com/MutualFund/MFSnapShot.aspx?opt=9&SecId=10&SubSecId=22,24

UTI Mutual Fund converts its scheme into open ended scheme

UTI Mutual Fund has declared that its UTI India Lifestyle Fund, which is a close ended scheme, will be converted to an open ended scheme. The change will be effective from 16th July, 2010. After the conversion to open ended scheme the fund will charge 1 per cent exit load, if units are redeemed within 1 year from the date of allotment. UTI India Lifestyle Fund is an equity scheme, with investment objective to provide long term capital appreciation and/or income distribution from a diversified portfolio of equity and equity related instruments of companies that are expected to benefit from changing Indian demographics, Indian lifestyles and rising consumption pattern. The scheme is benchmarked against CNX 500.

Source: http://finance.indiamart.com/cgi-bin/mutual_top_stories.cgi?news_headline=UTI+Mutual+Fund+converts+its+scheme+into+open+ended+scheme@MF045