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MINT MONEYS GUIDE TO UNDERSTANDING SERIES

MINT MONEYSGUIDE TO UNDERSTANDING

MUTUALFUNDS


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mint money

Financial plan-ners report aninteresting

trend in the port-

folios of the massaffluentthoughthe incomes havegone through amultiplier, thespending remainsmired in middle-class values, leaving asurplus of up to 70% of post-tax income. A little lower down theincome ladder, the surplus may not be solavish, but is enough for citizens to targetfinancial goals such as paying for theirkids study abroad or to maintain theirlifestyle in their silver years.

There is also the understanding thatthe old way of capital protection throughfixed deposits may not be the smartestchoice in a country that has two to threedecades of swift growth ahead. Today188 million people buy some form of afinancial product. Out of this, 8 millionparticipate in equity markets, directly orindirectly.

On the supply side, retail financialproducts are growing in number andcomplexity. There are 39 mutual fund

companies and another 23 are waitingfor licences. There are 23 life and 21 gen-eral insurance companies. All largebanks have a wealth management andmass retail piece as part of their totalproduct suite. There are at least 100 bro-kerages and distribution companies.There are at least 3 million advisers. Thismarket is at the threshold of significantexpansion as the disposable income inIndia doubles over the next decade.

The use of market-linked financialproducts is in its nascent stages. Themass urban affluent population is aware

of the products, but still hesitates tomake them a significant part of its assetallocation. One of the impediments tothis is the lack of trustworthy advice.While regulatory changes will take time,there is space for a media-led initiativethat will fill this information and knowl-edge gap as media remains an importantsource of information and advice forinvestors.

The role of an adviser is to be on yourside while evaluating various financialchoices and products. Mint Money, the

10-page daily sec-tion in Mint, i sthat adviser whohas your finan-

cial well-being atheart. MintMoney coversstocks, funds,insurance, real

estate, gold, loansand more. Not just

advice, Mint Moneyalso brings to you diverse

views from within and outsidethe country on broader trends that affectyour money. High networth investorsrely on wealth managers but need helpin understanding the nature of adviceand products they are sold. Mint Moneywill carry stories specially geared for thehigh networth investor.

We believe that you, the reader, getyour news and information off a varietyof sources. We hope to be there, wherev-er you look, whenever you need. If youhappen to miss the daily 10-pager, themicrosite,www.mintmoney.livemint.com , will haveall that the newspaper carries. And it hasmorecalculators, webchats, videos andblogs. Switch on your television and

Mint Money will be there soon with aweekly show.

A key part of our Mint MoneyEverywhere plan is to deepen the printoffering with a regular calendar of booksthat allow for a slightly deeper under-standing of asset classes, products andinvestment choices. What you hold inyour hand is the first book in the series.We have chosen mutual funds as the firstbook to mark the key role that funds willplay as India transforms into a developedcountry in the next two decades. Theseare efficient, low-cost vehicles that allow

you to ride the market in long term, orkeep money liquid in the short term.

Your constant feedback allows us toshift our edit focus as we go along andsome of our best ideas have come fromletters, emails and calls from readers likeyou. I hope to continue this process andlook forward to feedback and sugges-tions on what else we can do. Goodwishes for a prosperous and trouble-freemoney life.

[email protected]

MONIKA HALANEditor, Mint Money

EDITORSNOTE


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MUTUALFUNDS mint money

KINDS OF FUNDSThere are various kinds ofmutual funds. Its best tounderstand the purpose ofeach before investing

10P

AGE

CONTENTS

06PAGE

TYPES OF FUNDSApart from the broader classifi-cation, there are other distinc-tions between funds you needto know

14PAGE

HOW FUNDS WORKGetting into the details of howa mutual fund works, whattenets it follows and how muchit charges

16PAGE

MINT5050 curated funds, out of whichyou can choose according toyour needs

20PAGE

HOW TO USEMINT50Out of a list of 50, how do you

choose the ones that suitsyour investment require-ments? Heres the guide

22PAGE

FUND HOUSESList of fund houses, theiraddresses and phone numbers

23PAGE

HOW TO CHOOSEWhich fund suits you coulddepend on your age, goals andrisk appetite, among otherthings18PAGE

Cover illustrationJayachandran/Mint

FUND BASICSWhat is a mutual fund, why youneed to invest in them and whatare their advantages and disad-vantages


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FUNDBASICSWhen you are sold a mutual fund, you hear what the seller wants to

tell you. Knowing the basics of how a mutual fund works, its struc-

ture and its purpose will help you ask the right questions to make a

financial decision that suits your needs.

Managing money is adaunting task for mostpeople. While initial

enthusiasm may lead to a spurtof action resulting in a basket ofproducts, the regular regimeneeds research, regular invest-ment and maintaining a portfo-lio. Financial fitness is not unlikephysical fitnessboth begin with

great enthusiasm, but maintain-ing the effort needed for actualfitness is tough. Just as getting a

yoga teacher or signing up with agym helpsnot just in maintain-ing a routine and correct pos-tures, but also in having anexpert monitor your progressamutual fund is a vehicle thatallows you to hand over the spe-

cialized work of managing yourmoney to an expert.

WHAT IS A MUTUAL FUNDIt is a pool of money collected froma large number of investors by aprofessional entity with an aim toinvest in different avenues for a

variety of purposes. These avenuescould be equity, debt, gold, com-

modities, real estate and so on. Atpresent, in India, mutual funds arenot allowed to invest in real estatedirectly, though they can invest inequity shares or bonds of realestate companies. Equity, debt andgold are the most popular assetclasses that Indian mutual fundsinvest in. The purpose of invest-ment varies according to the asset

[ ]


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class chosen. Equity is usually avehicle for long-term wealthcreation. Debt is used for capitalprotection. Gold is used as hedgeagainst inflation and for liquidity.Investors can look at where the fundmanager aims to invest and thenmatch personal financial needs tochoose a fund.

WHY WE NEEDMUTUAL FUNDSManaging money is a specializedtask and a mutual fund can be

viewed as public transport to takepeople, who do not want to drive

their own cars (that is, take theirown investment calls), to theirinvestment destinations. People

who drive their own cars (investon their own) can end up goingfaster if they are good at choosingtheir investments, or can end upbadly hurt with a crashed car, los-ing money, due to poor invest-ment choices. While mutual fundsgive an option to invest in severalasset classes such as equity, debtand gold, retail investors findequity investing one of its biggestattractions as diversificationmakes it safer. Of course, investors

can diversify using stocks, but willhave to actively manage theirstock portfolio and that requiresknowledge and time. Mutual fundsare for those who don't have thetime to make money decisionsevery day but will do so, say, twicea year to examine their mutualfund choices and changed person-al financial needs.

Equity mutual funds are usefulfor lay investors since stock selec-tion is not easy for an averageinvestor and can be fairly risky.Reading balance sheets is a special-ized task and knowing when to buyand sell needs active monitoring of

markets and events.Most people are busy with their

jobs and families and have notime to spend on managing anactive portfolio. Additionally,small investors run the risk ofover-concentrating their portfoliosin a few stocks and seeing theirmoney erode due to the risk of atight portfolio. Funds hire profes-sional money managers to makeinvestment calls and monitor theportfolio on a daily basis.

The mutual fund route reducesvolatility by diversifying the portfo-lio. The risk of having all your

money in just one or two stocks ismuch higher than buying a basket ofstocks that is diversified across themarket and sectors.

PLUS AND MINUSFund pluses Small amounts can be invested.

You can begin with just Rs5,000to buy a mutual fund schemethat invests across 50 compa-nies. Investing in just one com-pany can be very costly. Forinstance, armed with Rs5,000,

you could buy just about, say,two equity shares of State Bank

of India, India's largest publicsector bank, but with a mutualfund, you can own tiny bits ofmany large companies. All, or some, money can betaken back quickly. Mutual fundsare easy to redeem. Funds willbuy back any quantity of units atthe given price as denoted in thenet asset value (NAV), or theprice of each unit of a mutualfund. You can redeem your liquidfund within 24 hours and equityand debt funds in less than threedays. There are some mutualfunds that come with a lock-in,such as equity-linked savings

schemes, but they impose a lock-in for a purposethey give tax

deduction benefits at the time ofinvesting. Few others come with alock-in, but they give redemption

windows at regular intervals.

Fund minuses Investors have to pay the fundmanager irrespective of profit orloss. As the fund manager's sole

job is to manage your money,they charge you every year inaddition to certain costs theyincur. The costs are capped butthey can hurt when you losemoney. Nothing wrong in payingthem, but the catch is even if your

fund underperforms the market,or even if markets do badly insome years like 2008 and you losemoney, you have to pay the annu-al charge called the expense ratio. Investors have no control instock selection. When you givemoney to your fund manager, it ishis decision which stocks to buyor sell and when. Its a double-edged sword. His calls may goright. His calls may also go wrong.Its not in your control. If his callsgo wrong, you obviously losemoney. There are no guarantees,as there aren't any when youinvest directly in the markets.

De-jargoned

What is expense ratio?Every time you invest in your mutualfund, it incurs some expenses. Theyare on account of marketing and

advertising, brokerages paid to bro-kers to buy and sell scrips, adminis-trative charges and so on. The capitalmarket regulator, the Securities andExchange Board of India (Sebi), lim-its the charges that your MF canimpose on you to 2.50% for equityfunds and 2.25% for debt funds. Anyexpenses incurred by the fund overand above these limits are to beborne by the fund house.

Did you know?

Mutual funds cannot assure anyreturnsSebi has banned MFs from assur-

ing any incomedividend or prin-cipalto investors. Here's why:prices of equity and debt scrips goup and down, depending on theirdemand and supply. Your MFscheme's NAV also moves accord-ingly since the money is investedin individual stocks and debt prod-ucts. Even liquid funds are proneto market swings.

Good quality equity sharesand high-rated debt scrips limitthe chances of your fund's valuegoing down to zero. However, theytoo fall in bad markets. In the2008 market crash, the Nifty

index (50 most liquid scrips onthe National Stock Exchange) lost52%. Large-cap funds also lost53.12% on an average. Qualityscrips limit your losses, but theydon't eliminate losses completely.

Capital protection-orientedfunds aim to protect, and notguarantee, your money. These arecompulsorily closed-end and, typi-cally, invest in a mix of equity anddebt scrips in a way that you getyour principalwith some gainsfrom the marketat the end ofthe term. Usually, these fundshave a tenor of three to five years.

What is NAV?NAV, or net asset value, is thetrue worth of a unit of a mutualfund scheme. It includes thegains it realizes in the market,dividend income, interest incomeit earns from the underlyingscrips, less expenses it incursand losses, if any. Since entryloads now stand abolished, afund's NAV is the price at whichyou get to buy your units. Whenyou sell your units, you get tosee them at NAV plus a nominalmark-up, known as exit load.

YOU CANREDEEM YOURLIQUID FUNDWITHIN 24HOURS ANDEQUITY ANDDEBT FUNDS INLESS THANTHREE DAYS


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KINDS OFFUNDS

[Mutual funds are going to be your money partner for the rest of your

life. It is worthwhile to spend a little time understanding the various

kinds of funds and what they mean for different investor types. It

could make mutual fund investing safer and more profitable.

Before you buy anything, youusually do a market surveyand see what is available and

then match your need to the prod-

uct. It is a good idea to do the samewhen you invest in a mutual fund.There are several ways in whichmutual funds can be viewed. Themost important distinction onemust make is to choose what finalproducts you are comfortable with.Mutual funds invest in differentasset classes including equity, debtand gold. Real estate is also anasset class that is available overseasas an investment choice, but theseare yet to come to India though theprocess is on. High return-seekinginvestors, who do not mind takingrisk, look at equity as an invest-

ment vehicle. Short-term investors,who may want to keep money liq-uid, need some sort of regularincome or keep their capital pro-tected and look at mutual fundsthat invest in debt products.Investors seeking to diversify theirportfolios and guard against infla-tion buy some gold through a fund.

And then, there are those whowant a fund to take care of multipleneeds and look at hybrid products.These combine assets classes in

various proportions to give aninvestor a ready-to-use asset-allo-cated fund. There are further sub-divisions within each asset class.

Within equity, for example, thereare clumps of stocks that carrylower risk than otherslarge-capcompanies carry lower risk and

return profile than mid-cap com-panies or those belonging to cer-tain sectors. Mid-cap companiescarry high risk but can also givea huge return kicker to theportfolio.

Then there are otherclassifications that are impor-tant. The distinction betweenopen-ended and closed-end fundsis important, as is between activeand passive funds. The three broadcategories, or distinctions, follow:

EQUITYEquity funds are those that

invest in shares of companiesthat are listed on the stockexchanges. The bonus and divi-dends paid out by the compa-nies also get added to the totalreturn of an investor. Withinequity, there are various cate-gories of products that come

with their own risk and returnattributes.

Large-capThese funds invest in large and

well-established companies inthe market such as State Bank ofIndia, Infosys Technologies Ltd,Reliance Industries Ltd and

Hindustan UnileverLtd. These companiesare heavyweights in thestock markets and are

well researched by manyexperts, fund managers and

analysts. Large-cap funds are,typically, the least risky funds.These companies are among theleast volatile companies as theyare mostly in mature businessesand have left the volatile growthperiod behind. They are also

widely held companies withshareholders running in millionsin certain cases. Most diversifiedfunds prefer to be invested sig-nificantly in large-cap scrips tolimit their volatility, but that isnot always a certainty.

Mid- and small-capThese funds are riskier than

large-cap funds. They invest insmaller companies that are intheir growing stages. The largecompanies of today were onceupon a time small- and mid-sized companies. Since mid-and small-sized companies arein their growing stages, they canget volatile in choppy anduncertain markets. These are

]


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MUTUALFUNDSmint money

high-risk companiesthey typi-cally rise more than large-capfunds in rising markets, but fallmore than large-cap companiesin falling markets. When thesecompanies graduate to beinglarge-cap companies, theirshare prices show a sharpincrease over a period of time.If your fund manager correctlyspots these companies, hecould make a killing. Wrongcalls can also prove to be verycostly and are punished by a

severe fall in value.

Sector/thematicThese invest in select sectorsand companies. While sectorfunds invest in one or two sec-tors, thematic funds invest in abunch of sectors that are wovenby a common theme, such asinfrastructure, consumerspending and fast-moving con-sumer goods. These are themost risky of all types of fundsas their portfolios are, typically,

very concentrated. Forinstance, in May, the portfolio

of one of the services sectorfund had just 13 stocks as itinvests in just banking andfinancial sector stocks, limitingthe universe of stocks it canpick. On the contrary, a diversi-fied fund has 30-100 stocks. Onaccount of their lack of diversi-fication, fortunes of sector andthematic funds depend on ahandful of sectors and stocks.Hence, it is generally advisablefor investors to have a properunderstanding of the theme orsector in which they wish toinvest through a sectoral or the-matic fund.

DEBTThese are funds that invest infixed-income yielding instru-ments. Debt funds are used forsome kind of regular return andcapital protection. There aremany types of debt funds, butbroadly they fall into three types:

BondBond funds invest in corporatebonds and partly in governmentsecurities. These funds are long-term and short-term in nature.

Typically, long-term bond fundscarry an average maturity of twoor more years to about five ormaybe even 10 years. This meansthat they invest in scrips thatmature around that period on anaverage. The longer a debt fund'saverage maturity, the riskier itgets because scrips with longmaturities take a long time to get

wound up and, therefore, getexposed to market vagaries and

volatilities for a long time. Short-term bond funds, typically, carrya maturity of one to two years.

Government securitiesThe second type of debt fund isgovernment securities fund. Likebond funds, these too come inlong-term and short-term variety.These are mostly seasonal fundsas they invest only in governmentsecuritiesscrips issued by theReserve Bank of India. Thoughgovernment securities are thesafest debt instruments becausethey are issued by the govern-ment of India and, hence, comeguaranteed, they are also themost volatile because they are themost liquid instruments in thedebt market. Other instruments

such as corporate bonds can getvery illiquid and, hence, don't seemuch price volatility compara-tively. Like bond funds, govern-ment securities funds come withan average maturity of two ormore years to five or maybe even10 years. Short-term governmentsecurities funds, typically, come

with a maturity of one to twoyears.

LiquidThe third type of debt fund is a

liquid fund. These are fundsmeant to park your surplus cashfrom a time period of overnightto about three months. In themutual fund space, these areconsidered the safest becausethey invest in scrips that maturein a very short time. Hence, theyarent as volatile, though thereare no guarantees. The 2008market crash brought about a lotof pain to liquid funds.Subsequently, the capital marketregulator, Sebi, introduced a lotof changes in liquid funds andmade them much safer.

A variation of liquid funds iscalled ultra short-term (ST)funds. They were earlier calledliquid-plus funds. Ultra STfunds work just like liquidfunds, but can invest in scripsthat mature in up to 90 days. Asthey have a higher leeway, theyhave the potential to earn a bitmore than what liquid fundscan earn. Typically, in steadymarkets, if liquid funds fetcharound 3.75% returns perannum, ultra ST funds canreturn about 4.5% returns.Compared with them, savingsbank accounts earn only 3.5%.

GOLDThese are mutual funds thatinvest in gold bars or gold-backed securities. Gold funds areof two typesthose that mimicgold prices in the form of anindex fund and those that buyshares of gold mining companies.Gold exchange-traded funds(ETFs, an index fund that is listedon the stock market) havebecome very popular during therun up in gold prices over the lastfew years. In FY10, while assetsunder management (AUM) ofequity ETFs went up to Rs24,066crore, up from Rs14,267 crorea

jump of 69% at the beginning ofthe financial yeargold ETFs

jumped by 122% to Rs1,590 crore,up from just Rs717 crore in thesame period. Since these are pas-sive funds, they mimic the priceof gold. When gold prices go up,gold ETF NAVs go up too and

vice-versa.Some funds also actively

invest in gold mining. These areMF schemes that solicit yourmoney and then invest theirentire corpuses in internationalfunds of their own parentage.The international fund will theninvest in equity shares of goldmining companies. At present,since there are no listed goldmining companies in India, yourmoney in these funds are sentabroad and invested there. Forinstance, DSP BlackRock WorldGold Fund is an Indian fund and

available to Indian investors inIndia. This fund invests its entirecorpus in BlackRock GlobalFunds-World Gold Fund, whichis listed abroad.

HYBRIDHybrid funds invest across equi-ty, debt and gold. They are eitherbalanced funds (invest around65% in equities and rest in debt)or monthly income plans/regularincome plans (invest up to 25%in equities and the rest in debt).They are less risky than equityfunds, but carry more risk thandebt funds.

LARGE-CAP FUNDSARE THE LEAST RISKYFUNDS. DEBT FUNDSINVEST IN FIXED-INCOME YIELDING

INSTRUMENTS.HYBRID FUNDS INVESTACROSS EQUITY, DEBTAND GOLD


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[ ]The distinctions in funds are useful to know to get the best out of

your investment. There are different fund types for different needs

of a person, so choosing among the available options become as

crucial as choosing a fund.

OPEN-ENDED ANDCLOSED-END

Another distinction in funds isbased on the length of time for

which the fund is collectingmoney. There are two kinds offunds under this classification:open-ended and closed-end funds.

Open-endedThese are funds where youcan get in and out any-time you want as theyhave perpetual life. Asinflows are unlimited and,typically, unrestricted, thereis no limit to which the corpuscan grow to. According to mutualfund tracker Morningstar India, thelargest equity scheme in India as of

May-end had a corpus of Rs7,490crore. And the oldest scheme hasbeen at work for the last 38 years.

At present, most fund houses pre-fer to launch open-ended funds asit helps the fund house garnermoney consistently and manage iton a continuous basis.

Closed-endThese are funds that restrict theirinflows. Once they are launched,they are open for subscription for afew days. Once the subscriptionperiod ends, they stop acceptingmoney from the public.

Closed-end funds, therefore,

also come with a fixed tenor suchas three, five or, typically, 10 years.Once the period gets over, closed-end funds either redeem the

money to their investors or convertthem to open-ended funds.

Different periods of time in thelast 20 years have seen open-ended and closed-end fundschange in popularity, not dueto investor interest but due to

what the asset managementcompanies (AMCs)the corpo-

rations that carry out the assetmanagement function for the

mutual fundwanted to launch. Inthe early years of the opening up ofthe mutual fund market, fund man-agers were not sure if investors wouldcome and stay in the fund. Due to

this uncertainty on account ofinvestor behaviour, most schemeslaunched in the 1990s were closed-end schemes. As the marketmatured, fund houses moved tooffering open-ended productstheynow knew that real retail money(your money) is sticky and does notlike to shift in and out of funds. Funds

switched to launching closed-end funds in 2006 and 2007

due to a cost advantagethat closed-end fundshad that allowed themto charge initial market-ing fees from you. Thatarbitrage is over and

TYPES OFFUNDS


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currently funds launch open-endedand closed-end funds with theinvestor and purpose of the fund inmind (though a majority of funds arenow open-ended funds).

ACTIVE AND PASSIVEAnother distinction that is impor-tant is between active and passivefunds. This distinction is based onhow the fund manager views hisrole. Active funds are those that aimto beat the market benchmark. Abenchmark is a reference pointagainst which fund managers andinvestors can compare perform-ance. For example, most equityfunds will have either the Sensex orthe Nifty index as benchmarks.

The funds that want to just mimican index are called passive funds.Investors who want to have an invest-ment vehicle that they want to

choose once and then just use overtheir investment lifetimes, without

worrying about whether their fundmanager is going to stay with thefund or whether he will sustain theperformance, choose passive funds.Investors who want returns that areahead of the market, and do not

mind taking the higher risk thatcomes due to the fund manager'srisk, choose active funds.

Active fundThe reason for the existence of anactive fund is to beat the bench-mark it has chosen to measure itsperformance against. The fundmanagers of active funds believethey have the ability to select stocksand time the market in a mannerthat makes the returns on theirportfolio higher than what the mar-ket (in the form of the benchmark)gives over a specific period of time.

Active funds have fund managerswho have the freedom to pick andchoose stocks they want to buy orsell. Of course, the freedom comesin an institutional structure withinternal rules. Since fund managersare actively involved, there are costs

on research and transaction.

Passive fundAlso called index funds since theironly aim is to mimic an index, theydon't have fund managers. In fact,they don't need fund managers.They simply mimic their bench-

mark indices. They invest inscripsand in exactly the sameproportionas lie in their bench-mark indices. They move up anddown as much as their benchmarksmove. For example, a passive fundon the Nifty index will buy all 50stocks in the Nifty in the same pro-portion as are held by the Nifty.Each time a stock is taken out oradded to the Nifty index, the fund

will do the same. On a day-to-daybasis, this makes lesser work than

what managing active funds wouldentail. Changes in the compositionof the index are usually not morefrequent than once a year. However,the individual weights of scrips inan index change every day andsince index funds are mandated tosimultaneously change their scrip

weights in the last half hour beforethe equity market closes, by rebal-

ancing their existing portfolios,index funds do end up incurringsome cost. Investors can expectalmost the same return as the indextheir fund tracks, though there willbe a small difference between anindex fund's performance and thatof its benchmark. Called trackingerror, this is caused because of thesmall cash component that everyindex fund keeps (to face redemp-tion pressure) and also the variouscosts it incurs (that eventuallyreduce your fund's NAV) such asbrokerage, advertising and market-ing. Costs are lower in a passive

fund compared with an active fund.Passive funds are of two kindsindex mutual funds and exchange-traded funds (ETFs).

An ETF is an index fund with justone difference from the investorspoint of view. Investors can buy andsell ETFs on the stock markets asthey need to be listed on a stockexchange. ETFs come with severaladvantages over an index fund. First,they have lower fee than index fundsand lower tracking error. They alsoallow you the facility of real-timebuying and selling, unlike indexfunds that will give you the priceonce a day on which you will invest.

Guide to understandingmutual fund growth anddividend option

Most MF schemes have dividend

and growth options. The dividendoption gives out a cash flow byliquidating some units periodical-ly, while the growth optionallows the money to stay invest-ed. While filling the investmentapplication form, if you forget tochoose one, your fund will allotyou the default option.

MFs pay dividends wheneveryour investments earn a profitthat they can pay out. If you needperiodic dividends as a source ofincome from, say, debt funds, or ifyou feel the need to periodicallybook profits in your equity funds,choose the dividend plan.

Remember, dividends come out ofyour own pocket. When a funddeclares dividend, its NAV comesdown by that extent. Dividendsare good for those who reinvestthem effectively or those whoneed them as current income.

THE REASONFOR THEEXISTENCE OFAN ACTIVEFUND IS TO

BEAT THEBENCHMARK ITHAS CHOSEN TOMEASURE ITSPERFORMANCEAGAINST

Did You Know?

Thematic funds can invest inother themesBy rule, thematic funds invest insectors that match with theirfocus. So, how come you see atechnology company in a rural

india fund or in an infrastructurefund. The former focuses on ruralIndia, the latter invests in infra-structure.

Can they sway?Yes, they can. Thematic funds,typically, aim to invest at least65% in their chosen themes.They can also invest in scrips orsectors that they perceive tobelong to their theme eventhough the common perceptionis otherwise. For instance, theinfrastructure fund can considerthat banks drive infrastructure

growth (through loans) andconsider them ancillary scrips.And thats permissible in theiroffer document.

What should you do?Read the offer document andcheck out the funds definition ofthe theme. Invest only if itmatches with what youre look-ing for. Thereafter, track thefunds portfolio statements. Ifyou find consistent large-scalediversions, stay away. Thematicfunds are risky because theyfocus on fewer sectors.


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HOW FUNDS

WORK

[ ]Funds in India have a fairly simple product structure. The rules around

benchmarking, costs and fund structure ensure that funds are easy toenter, hold and exitkey attributes for an investment product. Their

structure also ensures comparability that leads to better investment

decisions. It is an efficient retail vehicle for investment.

Amutual fund in India has athree-part structureasponsor, trust and asset

management company (AMC).The sponsor is the promoter with

a business view who initiates thebusiness to earn a profit. The

AMC is the entity that managesthe business of the mutual fund.The trust is the entity that holdsthe investors money so that nei-ther the sponsor nor the AMCcan use it for purposes other thanthe investment mandate of themutual fund. A trust is also theinternal governance body thatensures protection of investorinterest. India has not seen a sin-gle instance of a mutual fundrunning away with the investorsmoney, as was seen in the case of

plantation companies and manyother get-rich-quick schemesover the years. The market valuemay have been halved, but thathas been due to market valua-tions and not because the spon-sor or your AMC has run away

with your money. If the sponsorloses business interest, he can sellhis stake to another sponsor whotakes over the fund. Investors facemarket risk, but not the risk ofsystemic fraud when they investin a mutual fund.

There are some basic rules ofunderstanding a mutual fund andevaluating its performance.

Investors need to study thesebefore they make investmentdecisions. There are four thingsinvestors need to know beforethey invest. One, what is the

investment mandate of the fundthey are choosing. Two, what isthe benchmark the fund tracks itsperformance against. Three, whatis the return history of this fund.Four, what are the costs that they

will face.

INVESTMENT MANDATEYou need to ask the questionwhat does the fund aim to do withmy money? As the investmentmandate defines what your fund isand where it aims to invest yourmoney, it tells you whether or notthe fund is suited for you. Every

mutual fund scheme is supposedto have an investment mandate.This mandate tells you what thefund is about and what it does. Itlays down the boundary within

which the fund is supposed to play.The details of this mandate arepresent in the offer document. Anoffer document tells you everythingthat you need to know about a par-ticular scheme and also the fundhouse. This is a legal documentthat says that your fund cannotinvest beyond its mandate. If youfind that your fund has crossed itsinvestment mandate, you have theright to take action.

BENCHMARKIf your fund returns 10% over a year,how do you know whether it is goodor bad performance? Enter bench-mark indices. Every fund is mandat-ed to have a benchmark index and isalso mandated to compare its ownperformance with that of the bench-mark index. This gives you an ideaof how your fund is performing. If

you find that your fund is consistent-

ly underperforming the benchmarkindex, it's time to exit and switch to abetter performing fund. For exam-ple, your fund may have returned50% over a particular year, but if theindex it tracked, say, the Sensex,

went up by 70%, your fund has lostyour money. You would have beenbetter off investing in a passivebroad market index fund or a betterperforming active fund with a simi-lar investment mandate.


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RETURN HISTORYAlthough past performances don'tguarantee future returns, it gives

you comfort if your fund has per-formed well in the past. It gives youan indication of how the fund hasdone. Take a look at past perform-ances of funds in their fact sheetsthat they disclose once a month orevery quarter. You can also checkout a fund's website to know moreabout their performances.

COSTS OF A FUNDAs managing people's money incurscosts, mutual funds are allowed tocharge these to investors. Yourfund's NAV comes down to theextent of this cost that MFs areallowed to charge you. Over the

years, the costs of funds have come

down due to regulatory action andgrowth in the fund size. Earlier,funds were allowed to charge up to6% of the assets it collected everytime it launched a scheme. If thenew fund offer (NFO) collectedRs1,000 crore, Rs60 crore could betaken away from your moneytowards marketing charges andcommissions to the agents. Sebibanned open-ended funds tocharge this cost from April 2006 andclosed-end funds from January2008. There are four kinds of costsinvestors need to understand.

Loads: These are embedded costs inthe price of a mutual fund that arecollected by the fund house andgiven to the agent or bank whosells you the fund. It is a price youpay for the services received inhelping you buy the product.Effective 1 August 2009, it hasbecome a lot cheaper to invest inmutual funds as Sebi abolishedentry loads that were earlier at2.25% of your investment. Youneed to pay fees directly to youragent, commensurate to his servic-es, though entities such as banksdo deduct a sales charge from yourinvestment money. You can also

invest in MFs through online por-tals that are free of cost at present.They offer the convenience ofinvesting in funds through anonline platform as well as othertools to track your portfolio. Mostbrokerages and banks also offerfacilities to buy funds throughthem. They press nominal chargesthough. For instance, some largebrokerages charge Rs100 for alllump sum investments, irrespec-tive of the amount (for portfolio

values of less than Rs8 lakh). Fewothers charge Rs100 every quarter.

Fund management charge:Equity funds can charge a maxi-mum of 2.5% of the net assets. Debtfunds can charge a maximum of2.25% of the net assets. Usually as

the size of the mutual fund grows,economies of scale kick in and costsper head tend to go down. Largeequity funds with assets undermanagement (AUM) of over Rs500crore now charge a little under 2%as their annual costs, while thesmaller ones cost the full 2.5%. Thetotal cost also includes fund man-agement charges of a maximum of1.25%. This is the income of your

AMC that pays salaries to your fundmanagers. Any costs incurred overand above the limit are absorbed bythe fund house.

Exit cost: Many funds charge exitloads or a charge on your money

when you want to sell your invest-ment. This is mostly up to 1% of yourinvestment amount. However, exitloads are charged usually for early

withdrawals such as six months to ayear for equity funds. They act as adeterrent to quick withdrawals thatcould put pressure on fund man-agers to generate cash to meet

redemption. After a year, most equityfunds become zero exit-load.

Tax: Tax is imposed when you with-draw your money from MFs. If you

withdraw from an equity fundbefore one year, you pay 15% tax on

your capital gains (selling price lesscost price). Capital gains are exemptfrom tax if you withdraw from anequity fund after one year of invest-ing. Withdrawals from debt fundsare taxed at income-tax rates if you

withdraw your debt fund unitsbefore one year. If you withdrawfrom debt funds after a year, you pay

10% tax without indexation or 20%with indexation. Dividends are tax-free in your hands. However, debtfunds pay a dividend distributiontax (DDT) of 13.840% of the divi-dend amount that they distribute.Though dividends are tax-free in

your hands, DDT comes out of thedividend to be distributed. So, ineffect, it's you who end up payingthe tax. Dividends from equity-ori-ented funds are completely tax-free. These are going to change ifthe revised Direct Taxes Code,tabled in mid-June, comes intoforce. Most of the tax shelters forfunds will go away.

Timeline of the reducing load4 April 2006Amortization of expenses disallowedfor open-ended funds. Only closed-endfunds can amortize the expenses.Closed-end funds exempt fromcharging entry loads4 January 2008Entry loads waived on directapplications31 January 2008Amortization banned for closed-endfunds also1 August 2009Entry loads on all MFs banned

Guide to understandingexpense ratio

What is an expense ratio?There are no free lunches in

life. In order to multiply yourmoney every time you invest inyour MF, your fund houseincurs some expenses. Expenseratio is the cost that bites intoyour MF returns.

So, every time your fundmakes some money, it bites offsome bits and you get to havethe rest. It comes in many dis-guises such as marketing andadvertising expenses, broker-age expenses and administra-tive charges. You can't avoid it.

How much can be chargedSebi forces all fund houses tokeep expense ratio in check.Equity funds can charge up to2.5% and debt funds up to2.25% of the net assets. Themight and effect of expenseratio goes down as the size ofyour fund goes up because alarge-sized fund has morecapacity to tackle it comparedwith small-sized funds. Fundhouses are free to have moreof it, but beyond the Sebi-man-dated limit, it cannot affectyour money. Anything morethan the Sebi limits and thefund house gets it out of its

own pockets.

Is that it?Until August, when you invest-ed in an MF scheme, it used tobite off 2.25% of your invest-ment amount.

Your fund used to pass thisto your agent as his commis-sion. But Sebi wants to cutdown expense ratio to size. Itfeels that agents should direct-ly recover costs from investorsrather than charging the fundhouse.

Why is this important?The smaller the expense ratio,the bigger will be your returns.Back of the envelope calcula-tions show that Rs50,000invested in a diversified equityfund that charges 2.5% yieldsRs5.27 lakh after 20 years,assuming the equity marketsgrow at 15% on a compoundedbasis, against Rs6.29 lakh byan index fund that charges itsmaximum permissible 1.5% andRs7.50 lakh by an exchange-traded fund that charges 0.5%.


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Knowing about the funds isonly one part of the jour-ney. You need to match

your investment needsstage in

life and your own appetite forrisk to match your profile withthat of a mutual fund you buy.Investors tend to get swayedeither by recent top performanceof a fund or by sharp sales prac-tices. Mature investing wouldmean matching own needs toproducts in the market and if youcannot do this yourself, payingan adviser or financial planner todo this for you.

CHECKLIST OF CHOICEWhy do you need a fund

Ask yourself why you need a mutu-

al fund. Since there are over a thou-sand schemes in the market today,you need to match what you needwith what you buy. Here are somereasons why you need an MF andsome fund types that go with it. If you just want to park your

cash, you need a liquid fund,preferably an ultra short-term(ST) fund.

If you want to invest for abouttwo-years, but you may justneed the money anytime after,say six months, you need to buya short-term bond fund.

If you don't need the moneyimmediately and can take some

risk, you can invest in alow-risk equity-diversifiedfund, such as a passivefund like the index or an

exchange-traded fund. If you don't need the

money immediately butare comfortable with tak-ing high risk, you caninvest in actively managedequity fund.

If you are retired with agood pension and have asurplus that you need toinvest, you need an equityfund if you are willing totake risks or a balancedfund with an equity expo-sure to keep your moneyahead of inflation.

How old are youAge is an important factor inunderstanding what products youshould buy. Ideally, the younger

you are, the more you shouldinvest in equity. A rough rule ofthumb subtracts age from 100 toarrive at how much of your port-folio should go into equity prod-ucts. However, the exce ptions tothis rule are many. There aremany senior citizens who earn agood pension and have surpluscash that they like to invest inequity even though their age maynot indicate such a high-risk

appetite. You need to keep yourown finances in mind before youapply this rule.

For how long do you want to investEspecially for equity fund invest-ing, it is important to stay investedfor a long time to get the most outof your mutual fund. For equityfunds, a time horizon of at leastthree years is a must. Your invest-ment's duration is most importantin debt funds because differentdebt funds fall in different maturitybuckets. You need to make sure

your investment matches your debt

fund's duration to make sure thereturns are commensurate to theperiod you stay invested and getthe most out it. Investmentsovernight to up to a month work

well in a liquid fund. Between oneand five months, the ultra ST funds

work. Between five months and ayear-and-a-half, the short-termbond funds are your friend.

Anything above that, it is the long-term bond fund route.

Are you ok with riskAn MF is not a guaranteed prod-uct and risk is inherent with any

HOW TOCHOOSE

[ ]Finding a suitable mutual fund is all about knowing more aboutyourself. Your current stage in life, your age, how much money you

can invest and for how long, how much risk you are happy to take

and what you want out of that investment. Choosing a fund becomes

much simpler when you know what you want out of the product.


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MF. However, the levels of risksdiffer from MF to MF according to

where they invest and whetherthey are active or passive. Liquidfunds are the least risky while sec-tor equity funds are the riskiest.

However, even liquid funds can berisky, like they were in 2008 whenthere was a global freezing ofmoney markets and it was only forthe second time in about 10 yearsthat liquid funds lost money.

Active funds are more risky com-pared with passive funds since

you are taking the risk of a fundmanager taking stock calls thatmay go wrong. Within indexfunds, funds mimicking broaderindices are less risky than thosethat mimic market segments. Forexample, risk is lower in a Niftyindex compared with an index onJunior Nifty (This is a mid-cap-ori-ented index). Within the equitybucket, large-cap funds carrylower risk than sector, thematic ormid-cap funds. Remember,though, that to earn kicker inreturns, you need to take somerisks to be able to earn more thaninflation as the latter can easily eatinto your returns over a period oftime.

HOW TO BUY AMUTUAL FUND

You can buy directly from themutual fund house or from anagent or distributor. If you wish to

go directly, you have two choices.Visit the fund's website and down-load your chosen scheme's invest-ment application form. You canalso get the form from its registrarand transfer agent's office. Fill theform, attach the cheque and sub-mit it either at your fund's office or

its registrar's office. If you have anagent, have him deliver the form to

you. Fill the form, attach thecheque and submit it to youragent. Alternatively, you can alsoask your bank to help you invest inmutual funds. They will charge youthough. Now, online brokeragesalso allow you to buy mutual funds.If these online brokerages belongto banks, they would mandate youto open a bank account with them,else, independent online portalsthat specialize in mutual fundinvesting typically have tie-ups

with several banks.A new trend that became visi-

ble in 2009 was the use of online

comparison, transacting andmaintaining portals that do notcharge anything, yet offer a slewof services.

Transacting funds over theInternet is not new and can bedone in several ways. One, mostfund houses have been offeringtheir own schemes online. Butthis is just half the solution for aninvestor who has a portfolio ofseveral holdings. Getting a con-solidated look at his net worth isa transaction nightmare alongthis road. Two, all brokerages,including online, also offer MFs

in addition to equity shares.Three, banks, too, allow transac-tion in mutual funds on their own

websites.Investors run the risk of get-

ting a filtered choice of schemesand of still paying transactioncosts that may charge as much as1.75% of their investment for justmoving money from their savingsaccount to the fund.

The new kids on the block arethe independent online MF portalssuch as Fundsindia.com,Fundsupermart.co.in andPowermf.com. These work likeonline marketplaces for funds.

These are do-it-yourself channelsand are meant for those who are

confident of taking their owninvestment decisions. Some charge

you nothing for a choice of mostfunds and a facility to consolidate

your MF investments at one place.Online markets such as

Fundsindia.com andFundsupermart.co.in are free andearn trail commissions, but othersare not. Most brokerages andbanks press nominal charges.

Next to cost is the choiceparameter. Typically, banks offer a

wide choice, though some arechoosy. Online brokers and mar-ketplaces have most funds. But it is

best to check. For example,Fundsindia.com does not have MFschemes of some key fund houses.

The next in line is conven-ience. While brokerages give youa consolidated holding statementacross your equity and MF invest-ments, online marketplaces give

you a consolidated statement justfor funds. What these sites doallow, however, is portfolio analy-sis in many interesting ways. Forexample, it could give your totalinvestment in InfosysTechnologies Ltd or, say, thepharmaceutical sector, across all

your mutual fund holdings.

Guide to understanding afund of funds

What is it?The fund of funds scheme is quite like

any other mutual fund (MF) scheme.You invest in it and your money isdeployed in the markets. You can putin as much money as you like but,generally, Rs5,000 is the amount tobegin with.

What sets it apart?It is not like your typical MF scheme.While other MF schemes invest inshares and bonds directly, fund offunds invest in other MF schemes.Some of its clones invest in equityschemes and some in debt.

Why not invest in marketsNot only is it tough to consistently

pick winning scrips over the longterm, it is a challenge to pick win-ning MF schemes (that, in turn,invest in them) consistently. So, justlike other MF schemes help youdiversify across stocks and bonds,fund of funds help you diversifyamong MFs.

What's is the downsideThe tax treatment can hurt you as aninvestor. It is treated like a debt fundeven if it invests everything in equities.An additional expense ratio of 0.75%that it charges you, in addition to whatthe underlying schemes charge, also

adds to your burden.

De-jargoned | KYC norms

What is KYCKYC stands for know your client.Compliance with KYC norms aremandatory if you invest Rs50,000 ormore in MFs. These norms have beenput in place to prevent the seriousglobal issue of money laundering.

Check your statusYou can find out whether you arealready KYC-compliant. To do that,visit 'www.cvlindia.com'. Enter your

permanent account number and sub-mit. If you are already KYC-compli-ant, you will get an acknowledge-ment. Take a print out of thisacknowledgement and attach a copywith your MF application form.

If you aren't KYC-compliantYou will easily get a KYC form on theInternet. Take a printout, fill up theform and attach an address proof.Submit a copy at a centre thataccepts KYC forms, such as yourbank's branch or your MF's offices orits registrar's offices. You can alsoget a KYC form at these centres.

ACTIVE FUNDS

ARE MORE RISKYCOMPAREDWITH PASSIVEFUNDS SINCEYOU ARE TAKINGTHE RISK OF AFUND MANAGERTAKING STOCKCALLS THAT MAYGO WRONG


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mint money MUTUALFUNDS


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METHODOLOGYJust looking at returns while choosingthe next fund to buy is a sure way tolose money. What investors need issome measure of a funds perform-ance over the long term, while keepingan eye on the fund managers expert-

ise and costs. Mint50 uses a two-stepprocess to filter out schemes. Somerisks are quantitative and thereforethey can be mathematically arrived at,

while a few others are qualitative andneed a subjective approach. Amongthe former is a number called down-side risk that measures a funds returnper unit of risk. The higher the risk-adjusted return, the better the fund.

Mint50 uses ratings from mutualfund tracker Morningstar to generate ashortlist of funds. Morningstar givesstar ratings on the basis of risk-adjust-ed returns, going from a low of 1 to ahigh of 5. Mint50 picks up all funds

with a threshold three-star rating.Funds can have off-periods in their lifeand drop off the 4- or 5-star threshold.

A three-star rated threshold eliminatesaround two-third of the funds. Next arethe qualitative parameters where weconsider fund mandates, returns con-

sistency, portfolio analysis and fundmanager audit. The analysis looks atportfolio performance across risingand falling market periods to see howa fund navigates market volatility. A

portfolio analysis gives insights intowhat the fund manager is really doingbehind the net asset value number.

HOW TO USE MINT 50There are at least 1,000 MF schemesto choose from. Picking the right one

or the one that suits your style istough. That's where Mint50 comes in.MF experts in Mint Money have cho-sen 50 schemes across equity- anddebt-oriented categories that have

been selected following a well-defined process. However, investorsmust not buy all 50. After about 10funds, the benefits of diversificationlevels off and you are better off buy-ing just an index fund. A well-chosenportfolio is diversified across fund

houses, fund types and asset classes.Pick and choose around four to 10schemes from Mint50.

Don't worry if schemes, you arealready invested in, are not a part ofMint50. Not all schemes that are out-side Mint50 are not investment worthy.

While poorly managed schemes areaplenty in the market, there are manythat are good performers, but not a partof Mint50 because we think these arebetter alternatives. Mint50 is not a guideto existing investments. Refer to it if youchoose to invest afresh or want tochoose an alternative after deciding torebalance your portfolio.

After ascertaining how much youwant to put in equity and how muchin debt funds, take a core and satelliteapproach. The core schemes arethe rock solid, long-term performers.

You can consider staying invested inthem for a long time.

The satellite portion can be usedto add the returns kicker. If you areplanning to invest afresh, start by put-ting money in large-cap funds andlater diversify into mid-cap funds. Onelast thing: Morningstar India pitchesactive and passive funds in the samecategory. So, it is possible that passivefunds, such as Benchmark Nifty BeESand Franklin India Index Fund, have alower Morningstar rating. In risingmarkets, ETFs and index funds typical-ly underperform and, hence, a lowerstar rating. But since a passive fund'smandate is never to outperform theindex, but to mimic it, a lower ratingdoesn't matter.

HOW TO USE

MINT50

[ ]

Mint50 uses a two-step process to cull out these 50 funds out of a list

of at least 1,000 schemes in the market. The thresholds that funds

must cross to be a part of the list include tenor of the fund in the mar-ket, past performance, its attitude to risk, the costs it incurs and a look

at how the fund manager navigated down markets.

It is a nine-square grid. Each column represents an investment style. The first is "value". A fund marked inthis column would pick stocks due to low valuation (low price ratios and high dividend yields) and slowgrowth (low growth rates for earnings, sales, book value and cash flow). The central column represents"blend" funds, including value, core and growth stocks. The last column is "growth". A fund in this columnwould pick stocks of companies that are growing fast (high growth rates for earnings, sales, book value andcash flow) and high valuation (high price ratios and low dividend yields). The rows are the market-cap cate-gories across large-, mid- and small-cap. A fund in row one would buy stocks of large-cap companies andthat in the bottom row would buy stocks in small-cap companies.

STYLE BOXVal ue Bl end G row th

Large

Mid

Small


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FUNDHOUSES

[ ]Knowing your fund house is a good idea for it is usually a long ride

ahead with it. Good funds have loyal investors who stay on for years

and years. This list puts all the contact data of all the funds in the

market in a form that you will find easy to use.

AIG Global Asset Management Co. (India) Pvt. LtdFCH House, Ground Floor, Peninsula Corporate Park, GKMarg, Lower Parel, Mumbaiwww.aiginvestments.co.in1800 425 3444

Axis Asset Management Co. Ltd11th, Nariman Bhavan, Vinay K Shah Marg,Nariman Point, Mumbaiwww.axismf.com1800 3000 3300

Baroda Pioneer Asset Management Co. Ltd501 Titanium, 5th Floor, Western Express Highway,Goregaon (E), Mumbaiwww.barodapioneer.in1800 419 0911

Benchmark Asset Management Co. Pvt. Ltd405, Raheja Chambers, Free Press Journal Marg, 213,Nariman Point, Mumbaiwww.benchmarkfunds.com1800 22 5079

Bharti AXA Investment Managers Pvt. Ltd51, East Wing, Kalpatru Synergy, Vakola, Santacruz (E),Mumbaiwww.bhartiaxa-im.com1800 103 2263

Birla Sun Life Asset Management Co. LtdOne Indiabulls Centre, Tower 1, 17th Floor, Jupiter MillCompound, 841, Senapati Bapat Marg, ElphinstoneRoad (W), Mumbai

www.birlasunlife.com1800 270 7000

Canara Robeco Asset Management Co. LtdConstruction House, 4th Floor, 5, Walchand HirachandMarg, Ballard Estate, Mumbaiwww.canararobeco.com1800 425 0018

Deutsche Asset Management (India) Pvt. Ltd2nd Floor, 222, Kodak Marg, Dr DN Road, Fort, Mumbaiwww.dws-india.com91-22-66584300

DSP BlackRock Investment Managers Pvt. LtdTulsiani Chambers, West Wing, 11th Floor, NarimanPoint, Mumbaiwww.dspblackrock.com1800 200 4499

Edelweiss Asset Management Ltd5th Floor, One Indiabulls Centre, Tower 1, SenapatiBapat Marg, Mumbai

www.edelweissmf.com1800 425 0090

Escorts Asset Management Ltd11, Scindia House, Connaught Circus, New Delhiwww.escortsmutual.com91-11-43587420

FIL Fund Management Pvt. Ltd56, 5th Floor, Maker Chambers VI, 220, Nariman Point,Mumbai

www.fidelity.co.in1800 2000 400

Fortis Investment Management (India) Pvt. Ltd10th Floor, Sakhar Bhavan, Nariman Point, Mumbaiwww.fortisinvestments.in91-22-66560000

Franklin Templeton Asset Management India Pvt.LtdWockhardt Tower, Level 4, East Wing, C-2,G Block, Bandra Kurla Complex, Bandra (E), Mumbaiwww.franklintempletonindia.com1800 425 4255

HDFC Asset Management Co. LtdRamon House, 3rd Floor, HT Parekh Marg,169, Backbay Reclamation, Churchgate, Mumbaiwww.hdfcfund.com1800 233 6767

HSBC Asset Management (India) Pvt. Ltd314, Dr DN Road, Fort, Mumbai

www.assetmanagement.hsbc.com/in1800 209 0100

ICICI Prudential Asset Management Co. Ltd3rd Floor, Hallmark Business Plaza, Sant DyaneshwarMarg, Bandra(E), Mumbaiwww.icicipruamc.com1800 200 6666

IDBI Asset Management LtdIDBI Building, Second Floor, Plot No. 39/40/41, Sector11, CBD Belapur, Navi Mumbaiwww.idbimutual.co.in91-22-66096100

IDFC Asset Management Co. LtdOne Indiabulls Centre, Jupiter Mill Compound, 841,Senapati Bapat Marg, Elphinstone Road (W), Mumbaiwww.idfcmf.com1800 226622

ING Investment Management (India) Pvt. Ltd601/602, Windsor, Off CST Road, Kalina, Santacruz (E),

Mumbaiwww.ingim.co.in91-22-40827999

JM Financial Asset Management Pvt. Ltd5th Floor, Apeejay House, 3, Dinsaw Vachha Road, NearKC College, Churchgate, Mumbaiwww.jmfinancialmf.com1800-22-3132

JPMorgan Asset Management (India) Pvt. Ltd

Kalpatru Synergy, 3rd Floor, West Wing, Santacruz (E),Mumbaiwww.jpmorganmf.com1800 22 5763

Kotak Mahindra Asset Management Co. Ltd3rd Floor, Nariman Bhawan, 229, Nariman Point,Mumbaiwww.kotakmutual.com1800 22 2626

L&T Asset Management Ltd27th Floor, Unit 1, Centre 1, World Trade Centre, CuffeParade, Colaba, Mumbaiwww.lntmf.com91-22-61366600

LIC Mutual Fund Asset Management Co. Ltd4th Floor, Industrial Assurance Building, OppositeChurchgate Station, Churchgate, Mumbaiwww.licmutual.com91-22-22812038

Mirae Asset Global Investment Management (India)Pvt. LtdUnit No. 606, Windsor Building, Off CST Road, Kalina,Santacruz (E), Mumbaiwww.miraeassetmf.co.in1800 1020 777

Morgan Stanley Investment Management Pvt. LtdForbes Building, 5th Floor, Charanjit Rai Marg, Mumbaiindiamf.morganstanley.com1800 425 1313

Peerless Funds Management Co. LtdPeerless Mansion, 1, Chowringhee Square, 3rd Floor,Kolkatawww.peerlessmf.co.in91-33-40185000

Principal PNB Asset Management Co. Pvt LtdExchange Plaza, 2nd Floor, National Stock ExchangeBuilding, Bandra Kurla Complex, Bandra (E), Mumbaiwww.principalindia.com1800 225 600

Quantum Asset Management Co. Pvt. Ltd505, 5th Floor, Regent Chambers, Nariman Point,Mumbaiwww.quantumamc.com1800 22 3863

Reliance Capital Asset Management Ltd11th and 12th Floor, One Indiabulls Centre, Tower 1,Jupiter Mill Compound, 841, Senapati Bapat Marg,Elphinstone Road (W), Mumbaiwww.reliancemutual.com

1800 300 11111

Religare Asset Management Co. Ltd3rd Floor, GYS Infinity, Paranjpe B Scheme, SubhashRoad, Vile Parle (E), Mumbaiwww.religaremf.com1800 209 0007

Sahara Asset Management Co. Pvt. Ltd97-98, 9th Floor, Atlanta, Nariman Point, Mumbaiwww.saharamutual.com91-22-67520121

SBI Funds Management Pvt. Ltd191 E, Maker Tower, Cuffe Parade, Mumbaiwww.sbimf.com1800 425 5425

Shinsei Asset Management (India) Pvt. Ltd51, Harchandrai House, 81, Maharshi Karve Road,Marine Lines, Mumbaiwww.shinseifunds.com1800 419 5000

Sundaram BNP Paribas Asset Management Co. LtdSundaram Towers, 2nd Floor, 46, Whites Road, Chennaiwww.sundarambnpparibas.in1800 425 1000

Tata Asset Management LtdFort House, 221, Dr DN Road, Fort, Mumbaiwww.tatamutualfund.com1800 209 0101

Taurus Asset Management Co. Ltd305, Regent Chambers, 208, Jamnalal Bajaj Marg,Nariman Point, Mumbaiwww.taurusmutualfund.com1800 180 9000

UTI Asset Management Co. LtdUTI Tower, GN Block, Bandra Kurla Complex,Bandra (E), Mumbaiwww.utimf.com1800 22 1230

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