If you are new to mutual fund investing, it ta¬kes a while before you can come to terms with the multitude of terms used to showcase mutual fund returns. There is, for example, absolute returns, annualized returns, CAGR, IRR and so on. And to top it, folks like us keep talking to you about rolling returns and chide you for looking at trailing returns (or point-to-point returns)
We have been receiving queries from many of you on the series of covered bonds/market-linked debentures that are being issued by a platform. Many of you seem to derive comfort from the fact that the platform is backed by marquee investors. The interest in this new kind of bond appears palpable going by the number of YouTube videos plugging covered bonds as a high-return alternative to FDs.
POWERGRID Infrastructure Investment Trust (PGInvIT) is the third InvIT and the second in the power transmission space (the other being IndiGrid InvIT) to be listed in the Indian stock markets. It is sponsored by listed PSU Power Grid Corporation of India (PGCIL and henceforth called the Sponsor).
Please find an explanation of what an InviT is here. This article will give you only our quick take on the offer and whether it is suitable for you. It is not a deep dive into the InvIT’s business and financials.
Mirae Asset has come out with a NFO of NYSE FANG+ ETF and a fund of fund (FOF) with the same underlying ETF. This ETF
Some of you wish to invest in index funds and want to know the best index funds. Others want to hold a portfolio of index funds. Building a portfolio out of index funds or adding index funds calls for mixing strategies and market-cap segments. In this article, we’ll try to explain the key characteristics of some of the equity indices and how they can be paired with other index funds/ETFs or with active funds.
A recent addendum by Aditya Birla Sun life suggested that investors rollover some of the AMC’s FMPs that are maturing. The reason was that given the low-rate scenario, investors are unlikely to get good interest rates outside once they exit. And that staying invested would provide indexation benefit for capital gains and earn higher returns.
But some investors raised the doubt on whether the FMPs under question were in trouble. We therefore looked at their portfolios. They had high-quality AAA-holdings are unlikely to have had any pressure on repayment. In other words, there does not appear any credit related rollover compulsion.
ICICI Pru Nifty Low Vol 30 ETF now has a companion fund of funds that investors can use for SIPs and investments. Vidya Bala reviews the new offering.
Perpetual bonds have caused some sleepless nights for fund managers after SEBI’s circular earlier this month. On March 10th, SEBI issued a circular capping the debt scheme exposure to perpetual bonds at 10% and also laying down new rules how these bonds should be valued in debt scheme portfolios. We wrote a short take on it last week suggesting that you wait for clarity. SEBI has now come up with one more circular offering some clarification.
Target maturity funds invest with a stated maturity and pay you back when the maturity is reached. You can call them an FMP but one that is open-ended and takes fresh inflows and outflows.
With yields beginning to move up, more funds are now beginning to talk about ‘roll down strategy’ or a strategy where a maturity date is fixed thereby ensuring that the portfolio’s average maturity steadily falls as it nears maturity. For example, a 2027 target date fund will have a 6-year maturity now and a 5-year maturity in 2022 and so on, until the maturity reduces to near zero in 2027.
Small finance banks, with their focus on small ticket loans for urban and semi-urban India, are a play on the underpenetrated market for financial products in India. Yet, after stellar performances soon after their IPOs many of these stocks have seen their valuations levelled. So, when a new candidate – Suryoday Small Finance Bank IPO (Suryoday) comes out in an overcrowded primary market, how should it be judged? Read on.
SEBI’s recent circular on restrictions on both valuations and holdings of perpetual bonds by mutual funds has created a storm – not just among the fund manager community but all the way up to the Ministry of Finance.