Principal MF Announces Change In Key Personnel

Principal Mutual Fund has announced that Mr. Anupam Tiwari has been designated as Key Personnel of Principal Pnb Asset Management Co. Pvt. Ltd, due to his appointment as Assistant Fund Manager of the below mentioned schemes:

Principal Large Cap Fund, Principal SMART Equity Fund, Principal Services Industries Fund, Principal Personal Tax Saver Fund, Principal Monthly Income Plan and Principal Monthly Income Plan - MIP Plus.

Mr. Tiwari is aged 35 years, holds Chartered Accountant as his educational qualification. He has more than 7 years of experience in Equity Markets as Research Analyst and Fund Manager, Prior to joining Principal Mutual Fund, he has worked with Reliance Mutual Fund and Reliance Life Insurance.

Source: http://www.adityabirlamoney.com/news/499616/10/22,24/Mutual-Funds-Reports/Principal-MF-Announces-Change-In-Key-Personnel

2008-like crisis unlikely in Indian markets: Reliance MF

Amid growing concerns over the impact of bad news from the US and Europe on Indian markets, Reliance Mutual Fund has said the recent correction provides an attractive share buying opportunity for investors.

The country's largest fund house has also asserted that a doomsday scenario like the one experienced during the global financial crisis of 2008 was unlikely to return to Indian markets, as the variables are very different this time around.

In a research note, Reliance MF said: "In the current volatile environment, investors have started extrapolating the current context and speculating about the repeat of the doomsday scenario of 2008."

However, the current environment is quite different and most variables now are far superior in comparison to those prevailing at that time, it said.

"From an investor standpoint, we think notwithstanding the events/risks in the next few months, if one invests in equities now, in the ensuing period, one can expect relatively better returns over the following 12-18 months," it noted.

In the last few days, markets in India and abroad have fallen sharply amid mounting debt worries in the US and Europe.

The announcement of the US debt rating downgrade by ratings agency S&P last week further added to the market concerns.

Reliance MF said Indian markets have been under pressure for many months due to domestic macroeconomic concerns, as well as negative news flow on the political front.

"The recent global uncertainty has added to the market's woes. The US downgrade has probably acted as the last straw to break the back of the Indian investor's confidence," it said.

"Moreover, post the global financial crisis, the relative resilience of many emerging markets economies, in general, and India, in particular, has led to increased investors' faith in these markets," the fund house noted.

It said that global growth was being driven by developed markets in 2007-08, while emerging markets have emerged as the biggest source of growth in the last four years.

"Though not completely immune, the world economy is far less vulnerable to the US and other DM (developed markets) growth scare," it said.

Reliance MF further said falling prices of oil and other commodities could be an additional long-term positive for India and the "monstrous concerns of inflation and high interest rates might also be a thing of the past".

"While currently, a certain section of the market is worried about repeat of 2008, we believe as investors one should avoid panic and rather look at the current adverse environment as an opportunity," it added.

Source: http://economictimes.indiatimes.com/markets/analysis/2008-like-crisis-unlikely-in-indian-markets-reliance-mf/articleshow/9578059.cms

You can bank on mutual funds when markets are volatile

Accumulation of wealth through investments in mutual fund schemes is probably the best bet for retail investors - more so, in the current market conditions.

Investment advisers say in times of panic seasoned fund managers can protect your money better than many others and during a rally they can make the money grow faster than the overall market.

"It is normal to panic in these situations , but these are times when one can buy cheap," says Dhirendra Kumar, CEO, Value Research, a fund industry analytics and advisory firm. "There are long-term investment benefits from buying in a panic."

One of the first steps while investing in an MF scheme is to identify the purpose of such an investment: Whether the person is investing to accumulate wealth over a long period of time or the investment is for regular income. In the first case, a major portion of the investments should be in equities while in the other case it should be tilted towards debt funds. In the latter, to gain some upside from any rally in shares, a part of the investment could also be in monthly income plans (MIPs), advisers say. The combination of debt-equity exposure should change as the age profile changes. Here, the rule of thumb is that the percentage of equity exposure in a portfolio should be equal to 100 minus the investor's age.

"When one is in the accumulation stage over a long period, the portfolio should have high equity exposure," says Sumeet Vaid, founder & CEO, Freedom Financial Planners. "When the investment is for distribution (say the need for regular income for a retiree ), the portfolio could be 60% in debt, 30% in equity and 10% in gold funds," he says.

In the current market , some top MF schemes that Vaid prefers are HDFC Equity, DSP Blackrock Top 100, ICICI Prudential Focus Equity and Discovery and IDFC Premium , while on the debt side it is Birla Sun Life Dynamic Bond Fund and Reliance Gold Fund for investments in the yellow metal. Over the last year, while gold funds remain a clear winner with a return of nearly 41%, income funds have returned 9.6% and balanced funds a little over 8%.

Source: http://economictimes.indiatimes.com/personal-finance/mutual-funds/analysis/you-can-bank-on-mutual-funds-when-markets-are-volatile/articleshow/9575305.cms

‘One needs to launch funds with a lot of responsibility’

In spite of 17 years of operations, Taurus has a compact portfolio of products compared to its peers as it believes in launching meaningful funds which connect with investors and distributors alike. Waqar Naqvi, CEO, Taurus Mutual Fund shares his strategy and plans in this interview.

Taurus MF has seen a spike of Rs 2,461 crore AUM in April-June quarter. What has contributed to this growth?

We have delibrately taken a more difficult path of growing assets across all categories and not relying excessively on banking money. This approach has paid off. As of now, we manage only Rs 1,500 crore of banking money. It took us some time to achieve this. I think the investors have confidence in our ability to perform and deliver good performance.

What’s your equity component of the total AUM?

Equity assets are 7 per cent of our total AUM.

Would your focus be on launching new funds or on the existing funds?

We promote our flagship funds on an ongoing basis. We are also looking to launch new funds.

What kind of funds are in the pipeline?

We are not a great believer in sector funds. However, we are positive on the banking space. We will launch a banking and financial services fund because banking is a reflection of the broader economy which lends to all sectors. We are also planning to launch a balanced fund. We are awaiting SEBI approval for the same. One needs to launch funds with some responsibility in this business. Our Ethical Fund was not a ‘me too’ fund. We came up with a MIP Fund which has a gold component and it has been performing well.

There is lot of buzz around SIPs. How many SIPs are you adding per month?

We started focusing on SIPs only this year because we thought paying higher upfront commission would invite churn. AMCs are paying more than what they are earning from SIPs. We are participating in SIPs with our trusted distributors. Every month, we are adding around 3000 new SIPs.

Which channel of distribution do you see growing in the future?

I think banks’ share in MF distribution will go up marginally in the future. Their share has already gone up in the last three to four years.

How many active IFAs do business with you?

Around 1000 IFAs give us business every month.

What engagement programs do you plan to have for IFAs?

We call global mutual fund celebrities to address our distributors. We also do a lot of cultural and sports activities with IFAs at the regional level. Apart from this, we conduct meetings with the IFAs’ clients, relationship managers and run contests.

Some of the infrastructure funds have exposure to stocks which are beyond the definition of infrastructure companies. What is the reason for this?

Our Taurus Infrastructure Fund is a five star rated fund. If our infrastructure fund underperforms during certain market cycles, it is only because we do not hold any non-infrastructure stocks. Some fund managers deviate from the theme only to provide some returns. Whether deviating or staying focused on the theme is a debatable issue. Even though the offer document allows investments in non-infrastructure stocks, we have tried not to deviate from the infra theme.

SEBI recently announced incentive structure for distributors. What’s your take on it? Will it help encourage new IFAs to join the industry?

It will help the existing IFAs. It will stop IFAs from moving out of the industry. IFAs focusing on HNIs have not been much concerned about the scrapping of entry load. The incentive structure proposed by SEBI addresses the IFA segment which was hit the hardest by the entry load ban.

Source: http://cafemutual.com/News/InnerNews.aspx?srno=80&MainType=Ana&NewsType=Interviews&id=43

DSP BlackRock Savings Manager Fund to Be Renamed as DSP BlackRock MIP Fund

DSP BlackRock Mutual Fund has announced that DSP BlackRock Savings Manager Fund will be renamed as DSP BlackRock MIP Fund. Further, Monthly Income Plan and Quarterly Income Plan under the scheme will be renamed as Monthly Dividend and Quarterly Dividend respectively. The changes will be effective from 22 August 2011.

DSP BlackRock Savings Manager Fund is an open ended income scheme which has the investment objective to generate income, consistent with prudent risk, from a portfolio which is substantially constituted of quality debt securities. The scheme will also seek to generate capital appreciation by investing a smaller portion of its corpus in equity and equity related securities of issues domiciled in India.

Source: http://www.adityabirlamoney.com/news/498582/10/22,24/Mutual-Funds-Reports/DSP-BlackRock-Savings-Manager-Fund-to-Be-Renamed-as-DSP-BlackRock-MIP-Fund

Neutral on IT stocks: Rajat Jain, Principal Mutual Fund

In a chat with ET Now, Rajat Jain, CIO, Principal Mutual Fund, shares his views about IT stocks.

Is it too early to buy IT stocks, they have corrected on an average by about 15% plus but large cap IT stocks are still expensive, TCS is trading at a PE multiple of 17 times, Infosys 14-15 times, HCL Technologies still about 13 times?

The markets kind of extrapolating what is happening on the US and European markets and the sense is that as economy slow, probably IT spends take a knock and that flow slows to Indian companies. Markets kind of taking that extrapolation but we have also seen that their margins are generally compressing in the past so at some valuation they will be interesting but we are in our portfolio have neutral bit on IT stocks.

Source: http://economictimes.indiatimes.com/markets/stocks/views/recommendations/neutral-on-it-stocks-rajat-jain-principal-mutual-fund/articleshow/9550838.cms

Goods, construction space may be re-rated: Rajat Jain, Principal Mutual Fund

In a chat with ET Now, Rajat Jain, CIO, Principal Mutual Fund, shares his views about FMCG and pharma space.

Indian market has two ends; one end which is the FMCG/pharma and the consumption space which is trading at a multiyear high. The other end is infra, real estate and machinery stocks which are trading at a multiyear low. Which part of Indian market will get re-rated or de-rated?

The thing which is already high as you pointed out, FMCG and pharma potentially well they can only at some point of time de-rated if the kind of growth expectations that the market builds in do not come through. Gradually if you see cap expenditure comes back in, their work in construction space which kind of reasonable if people make reasonable margins again. The capital good/construction companies can get re-rated but market will slightly take some time before it re-rates, it would not rate them in a hurry. If they see companies making margins, funds again and see capex orders coming in that will happen but it will take some time.

Source: http://economictimes.indiatimes.com/markets/stocks/views/recommendations/goods-construction-space-may-be-re-rated-rajat-jain-principal-mutual-fund/articleshow/9551028.cms

Prashant Jain on why this is a good time to buy stocks

A contrarian voice amid fervent calls for a cautious approach to equity investment at this point.

Here is what the reclusive, but highly rated Prashant Jain has to say on the ongoing turmoil in the market. In a note to his unitholders, the 43-year old executive director and chief investment officer of HDFC Mutual Fund says this is a good opportunity to "press the pedal on equity investments" (he is not saying whether by directly buying shares or through mutual funds!!!)

Jain, an ardent believer in the power of compounding, says there is little chance of going wrong while buying equities at a Sensex (forward) price to earning ratio of between 10 and 13.

Citing instances in the past, Jain says if you had bought the Sensex in September 2001 just after the 9/11 attacks, (when the index was available at a forward PE of 11) you would have made 84% over the next three years and 316% in five years.

And if you were bold enough to buy the Sensex during the collapse of the US housing market in June 2006 when the Sensex was going for a forward PE of 13, you would have made 61% in three years and doubled your money in five years.

Like Sachin Tendulkar makes batting look easy, Jain wants us to believe that there is no rocket science to investing.

"Good returns materialize over time on investments made at cheap valuations (meaning low PEs) and PEs are more likely to be low when the news flow is adverse. Simple, isn’t it! To be successful in investing, one should focus more on value and less on news flow."

Jain says the market is not yet factoring the benefits to the Indian economy from a downtrend in crude oil prices. Here is how he puts it:

"Sau sunar ki, ek luhar ki. This is a popular Hindi saying which means - 100 hits by the goldsmith have the same impact as 1 blow by the ironsmith. The not so appealing news items mentioned above miss one important happening and that is falling crude prices. Falling crude prices is the blow of the ironsmith, the positive impact of which is more than the negative impact of the rest."

Source: http://www.moneycontrol.com/news/market-outlook/prashant-jainwhy-this-isgood-time-to-buy-stocks_574965.html