Record date for dividend is 3 December 2012
Thursday, November 29, 2012
IDFC Fixed Maturity Plan Yearly Series 56 Announces Dividend
Reliance Fixed Horizon Fund XXII Series 5 Announces Dividend
Record date for dividend is 3 December 2012
UTI Fixed Income Interval Fund – Series II - Quarterly Interval Plan VI Announces Dividend
Record date for divided is 3 December 2012
The scheme recorded NAV of Rs 10.1393 per unit for retail plan and Rs 10.1417 per unit for institutional option as on 26 November 2012.
Tata MF Announces Dividend For Tata Tax Saving Fund
Record date for dividend is 3 December 2012
The scheme recorded NAV of Rs 45.6975 per unit as on 26 November 2012.
Religare Mutual Fund Announces Dividend Under Two Schemes
Record date for dividend is 3 December 2012
The fund house has fixed 3 December 2012 as the record date for the purpose of determining eligible unit holders holding units of the schemes who would be entitled to the maturity/redemption proceeds on the maturity/final redemption date of the schemes, which is 3 December 2012.
L&T Mutual Fund Announces Dividend Under L&T FMP VI – Plan A
Record date for dividend is 3 December 2012
The scheme would mature on 3 December 2012 and accordingly, units shall be suspended from trading on the NSE where the scheme is listed.
HDFC FMP 370D November 2011 (3) Announces Dividend
Record date for dividend is 3 December 2012
ICICI Prudential Interval Fund II – Quarterly Interval Plan C Announces Dividend
Record date for dividend is 3 December 2012
UTI Fixed Income Interval Fund – Annual Interval Plan IV Announces Dividend
Record date for dividend is 4 December 2012
The scheme recorded NAV of Rs 10.1524 per unit for retail plan and Rs 10.1468 per unit for institutional option as on 27 November 2012.
ICICI Prudential Multiple Yield Fund – Series 2 – Plan A Announces Dividend
Record date for dividend is 4 December 2012
The scheme recorded NAV of Rs 11.1050 per unit as on 27 November 2012.
SBI Life launches guaranteed savings plan, "Smart Income Protect"
Tax free, Regular Income at 11% of Sum Assured or Paid-up Sum Assured
Atanu Sen, Managing Director and CEO, SBI Life, said "The plan caters to a sizeable Indian population which is comfortable with no-risk savings products that offer guaranteed returns. Our endeavor is to offer a wide range of smart and simple life insurance solutions enabling a choice corresponding to customers risk appetite."
SBI Life's Smart Income Protect caters to future needs like post retirement or child's future expenses through its attractive feature of guaranteed annual payouts. Not only the policyholder receives a lump sum bonus at maturity but also guaranteed payout for fifteen years after the maturity. The lump sum bonus, at maturity, comprises Vested Reversionary Bonuses and Terminal Bonus, if any. In the event of a policyholder's death, the sum assured is immediately payable to policyholders nominee or legal heir as a lump sum, along with the bonuses.
Conveniently, based on required estimated income stream for future needs and premium paying capacity, customers can opt for a premium payment term of five, ten or fifteen years. Offering the possibility of enhancing protection, the plan is equipped with wide range of riders including Accidental Death Benefit Rider, Accidental Total and Permanent Disability Rider and Criti Care 13 non-linked rider.
Tuesday, November 27, 2012
Companies, HNIs set to bypass MF distributors, invest directly from January 1
Three
years after the then Sebi chief CB Bhave shook up Indian fund houses,
the mutual fund industry is now in the cusp of another big change. Come
January, several bank and corporate treasuries that comprise the largest
investor group in MFs will sidestep intermediaries and invest directly
to earn higher returns. A fortnight ago, many such big ticket investors
who regularly park surplus funds in liquid MF schemes, have communicated
their decision to leading
distributors, sources told ET.
These investors will subscribe to ’direct plans’ which will be cheaper by 50-75 basis points as customers have the flexibility to invest directly without incurring any incidental costs. According to a Sebi decision taken earlier this year, every fund and scheme must have a direct plan for investors who do not want distributor support and the net asset values of such plans will be given separately. "We have informed our distributor about our decision. Some of the banks have also done it. While it’s unclear whether fund houses will serve us like distributors, there will be a cost benefit and higher return for us," said the treasurer of a large financial institution.
Meanwhile, asset management companies are facing a test of loyalty with fund distributors requesting them to go slow on their roll-out of direct plans while market regulator Sebi has directed them to introduce the facility by January 1. The regulator, said a fund manager, has been informally asking fund houses to start getting approvals for their "direct plan" fund variants. Companies, HNIs set to bypass MF distributors, invest directly from January 1 Fund houses will have to file their scheme information document by December 5, if they have to meet the January 1 deadline. The regulator typically takes 21-25 days to approve new plans. It could be a matter of time before HNIs and smart retail investors, lured by a higher return, figure out the way to invest directly.
Fund distributors are apprehensive about the whole idea. "I think the time has come for the distributor community to fend for itself and start looking at alternate sources of businesses like insurance and real estate. The regulator thinks that the industry can survive and thrive without the participation of distributors who have actually brought the industry to the current stage," said Sunil Jhaveri, the founder of MSJ Capital & Corporate Services, a leading advisor.
According to another Mumbai-based distributor, the new arrangement will result in many existing investors shifting to the direct plan after taking the advice. Most institutional investors may have to compulsorily shift their fund allocation to direct plans with their respective boards nudging them to invest surpluses at lower cost. Currently, investors putting money directly with MFs have no cost advantage; it’s the AMCs that gain. The Indian MF industry manages over Rs 5 lakh crore in fixed income schemes. Over 90% of these investors are corporate treasuries and banks. As on September 30, corporate treasury investments account for nearly 82% of the liquid fund/money market fund pool, 64% of the gilts fund pool and 54% of the intermediate bond fund pool.
"The entire institutional chunk will move into direct plan once it is launched. They cannot be blamed as institutions are bound by certain corporate governance norm which mandates them to invest surpluses at lower cost," said Dhirendra Kumar, MD of fund research firm Value Research. "Direct plan is a good option for investors who have expertise to invest on their own. The problem now is that even Sebi is desirous of bringing in new investors into the industry. Direct plans are not good for new investors. They need expert handholding for some years before they could start doing it themselves," said Kumar who has tracked the sector for years. He felt that it’s a bit unfair from distributors’ point of view as investors, whom they helped all along, will move out on their own and shift to direct plans once they get a hang of fund investments.
This is not the first time when Sebi has come out with a direct investment route for mutual fund investors. Under chairman M Damodaran, Sebi had introduced the "direct application route" as a freeway for investors who did not want to pay the 2.25% entry load. The industry receives nearly 7% of the SIP investments - that is about Rs 61 crore spread over 3.15 lakh folios - through the direct application route. "But direct plans will have more impact than direct application route as the former passes benefits of unassisted investing to investors in the form of higher NAVs. Investors will lap up direct plans," said a Mumbai-based independent financial advisor.
Foundation of Independent Financial Advisors (FIFA) had written to Sebi expressing its displeasure over direct plans. "Such a step could lead to a lot of existing investors who have taken advice shifting to the direct class after taking advice," said Dhruv Mehta, chairman of FIFA, in his letter to Sebi. "This move could benefit very large Institutional investors, FII investors and super HNIs who can do investments on their own. The introduction of a direct plan would have a deep impact on the IFA community as a whole," he said in his letter.The distributors had sought the support of Amfi to take up the matter of direct plan with Sebi. Amfi members, in its board meeting, had decided to form a committee to discuss the matter with the regulator.
However, there has not been any concrete move on the part of Amfi after that, both distributors and fund executives said. "We’re left with no option now. We sympathise with distributors, but we can’t do anything about it. We’ll have to seek approvals to launch direct plans. We plan to file next week," said the CEO of mid-sized fund house.
Distributors, in all probability, may toe Sebi’s line. The savvier ones will re-work their product profile to include more of insurance and fixed income products . Insurance and fixed income products quote higher upfront commission for distributors. "First, Sebi took away upfront brokerage by abolishing entry loads, now it is doing away with trail as there are no brokerage payouts for direct investments. What do advisor earn? Nothing," said Jhaveri.
source: ET
distributors, sources told ET.
These investors will subscribe to ’direct plans’ which will be cheaper by 50-75 basis points as customers have the flexibility to invest directly without incurring any incidental costs. According to a Sebi decision taken earlier this year, every fund and scheme must have a direct plan for investors who do not want distributor support and the net asset values of such plans will be given separately. "We have informed our distributor about our decision. Some of the banks have also done it. While it’s unclear whether fund houses will serve us like distributors, there will be a cost benefit and higher return for us," said the treasurer of a large financial institution.
Meanwhile, asset management companies are facing a test of loyalty with fund distributors requesting them to go slow on their roll-out of direct plans while market regulator Sebi has directed them to introduce the facility by January 1. The regulator, said a fund manager, has been informally asking fund houses to start getting approvals for their "direct plan" fund variants. Companies, HNIs set to bypass MF distributors, invest directly from January 1 Fund houses will have to file their scheme information document by December 5, if they have to meet the January 1 deadline. The regulator typically takes 21-25 days to approve new plans. It could be a matter of time before HNIs and smart retail investors, lured by a higher return, figure out the way to invest directly.
Fund distributors are apprehensive about the whole idea. "I think the time has come for the distributor community to fend for itself and start looking at alternate sources of businesses like insurance and real estate. The regulator thinks that the industry can survive and thrive without the participation of distributors who have actually brought the industry to the current stage," said Sunil Jhaveri, the founder of MSJ Capital & Corporate Services, a leading advisor.
According to another Mumbai-based distributor, the new arrangement will result in many existing investors shifting to the direct plan after taking the advice. Most institutional investors may have to compulsorily shift their fund allocation to direct plans with their respective boards nudging them to invest surpluses at lower cost. Currently, investors putting money directly with MFs have no cost advantage; it’s the AMCs that gain. The Indian MF industry manages over Rs 5 lakh crore in fixed income schemes. Over 90% of these investors are corporate treasuries and banks. As on September 30, corporate treasury investments account for nearly 82% of the liquid fund/money market fund pool, 64% of the gilts fund pool and 54% of the intermediate bond fund pool.
"The entire institutional chunk will move into direct plan once it is launched. They cannot be blamed as institutions are bound by certain corporate governance norm which mandates them to invest surpluses at lower cost," said Dhirendra Kumar, MD of fund research firm Value Research. "Direct plan is a good option for investors who have expertise to invest on their own. The problem now is that even Sebi is desirous of bringing in new investors into the industry. Direct plans are not good for new investors. They need expert handholding for some years before they could start doing it themselves," said Kumar who has tracked the sector for years. He felt that it’s a bit unfair from distributors’ point of view as investors, whom they helped all along, will move out on their own and shift to direct plans once they get a hang of fund investments.
This is not the first time when Sebi has come out with a direct investment route for mutual fund investors. Under chairman M Damodaran, Sebi had introduced the "direct application route" as a freeway for investors who did not want to pay the 2.25% entry load. The industry receives nearly 7% of the SIP investments - that is about Rs 61 crore spread over 3.15 lakh folios - through the direct application route. "But direct plans will have more impact than direct application route as the former passes benefits of unassisted investing to investors in the form of higher NAVs. Investors will lap up direct plans," said a Mumbai-based independent financial advisor.
Foundation of Independent Financial Advisors (FIFA) had written to Sebi expressing its displeasure over direct plans. "Such a step could lead to a lot of existing investors who have taken advice shifting to the direct class after taking advice," said Dhruv Mehta, chairman of FIFA, in his letter to Sebi. "This move could benefit very large Institutional investors, FII investors and super HNIs who can do investments on their own. The introduction of a direct plan would have a deep impact on the IFA community as a whole," he said in his letter.The distributors had sought the support of Amfi to take up the matter of direct plan with Sebi. Amfi members, in its board meeting, had decided to form a committee to discuss the matter with the regulator.
However, there has not been any concrete move on the part of Amfi after that, both distributors and fund executives said. "We’re left with no option now. We sympathise with distributors, but we can’t do anything about it. We’ll have to seek approvals to launch direct plans. We plan to file next week," said the CEO of mid-sized fund house.
Distributors, in all probability, may toe Sebi’s line. The savvier ones will re-work their product profile to include more of insurance and fixed income products . Insurance and fixed income products quote higher upfront commission for distributors. "First, Sebi took away upfront brokerage by abolishing entry loads, now it is doing away with trail as there are no brokerage payouts for direct investments. What do advisor earn? Nothing," said Jhaveri.
source: ET
L&T Finance completes acquisition of Fidelity’s Indian MF biz
| L&T Finance, a part of diversified group Larsen & Toubro, today said it has completed the acquisition of Fidelity’s mutual fund business in India for an undisclosed amount. On completion of this transaction, the all new L&T Mutual Fund has over Rs 12,800 crore in managed assets and an investor base of close to 9.5 lakh investors from more than 200 cities and towns, a company statement said. |  |
"With this acquisition, our fund suite spans the whole range of investment opportunities - equity, fixed income, hybrid, domestic and international funds - and moves us closer to becoming one of the country’s leading and admired asset management companies," L&T Finance Holdings Chairman & Managing Director Y M Deosthalee said. This transaction is among one of the largest M&A deals in the Indian mutual fund industry and provides L&T with the necessary size, scale and momentum to move to the next level. L&T Mutual Fund has recently strengthened its investments team.
The AMC has appointed S N Lahiri as Head - Equities, Shriram Ramanathan as Head - Fixed Income and has enhanced its research team in order to increase coverage. "Over the last few months, we focused on a seamless transition and adding high quality talent to our investments team and other areas," L&T Finance Holdings President & Wholetime Director N Sivaraman said. The new entity will answer different customer needs with a range of investment options spanning 25 funds across asset classes, risk profiles and time horizons.
In March, L&T Finance had announced that it will take over the mutual fund business of Fidelity of its India operations. But, it did not disclose the financial details. L&T Finance is a part of engineering conglomerate L&T Group and Fidelity Mutual Fund is part of the US-based Fidelity Worldwide Investment.
source: PTI
Life insurer’s premium mop-up drop 3.45% in April-October: Irda
| Premium collected by life insurance companies dropped 3.45 per cent in the April-October period due to various factors that are influencing the financial sector as a whole. As per the data released by the Insurance Regulatory and Development Authority of India ( Irda), premiums collected by 23 private sector companies and lone state-owned LIC totalled Rs 53,814.09 crore during the period. They together had collected Rs 55,737.84 crore in the April-October 2011 period. |  |
India’s largest life insurer LIC reported a drop of 2.88 per cent in its premium collection, while the decline in private companies was 5.07 per cent. LIC’s premium collection stood at Rs 40,069.84 crore in April-October as against Rs 41,259 crore in the year-ago period. Private insurers netted Rs 13,744.25 crore as against Rs 14,479 crore in the corresponding period of 2011-12. Life insurance companies collect premium under four segments -- individual single, individual non-single, group single and group non-single.
Reliance Life’s premium collection dropped by 14.78 per cent, that of ICICI Prudential by about 6.9 per cent and of HDFC Standard Life by approximately 5 per cent. Last week, the Finance Ministry had said in Parliament that the reasons for a negative growth in the premium collections are various factors that are influencing the financial sector as a whole.
HDFC ERGO Gen launches ’Health Suraksha Top Up’ plan
| Private insurer HDFCBSE 2.87 % ERGO General Insurance today launched ’Health Suraksha Top Up’ plan allowing a customer a larger sum insured limit at lower cost. The policy comes into action once the sum insured of the existing policy is exhausted, giving an additional sum insured to cover the medical expenses beyond a threshold limit of the existing health insurance plan to a customer, HDFC ERGO General Insurance said in a release issued here. |  |
The plan is available for sum insured options of Rs 5 lakh, Rs 7.50 lakh and Rs 10 lakh. "...People who have some health insurance cover may find it inadequate as they grow older or move into different life-stages. Health Suraksha Top Up is an ideal option for such cases," said Mukesh Kumar, the HDFC ERGO General Insurance Head - Strategic Planning, HR and Marketing.
"The customer will also have the option to choose between one year and two year policy tenure for individuals and family floater and avail tax benefit," he added. The policy is aimed at salaried employees with an existing health policy, he said. HDFC ERGO General Insurance is a 74:26 joint venture between country’s premier housing finance institution HDFC and ERGO International AG, the primary insurance entity of Munich Re Group.
source: PTI
HDFC MF Announces Maturity Proceedings of HDFC FMP 370D November 2011 (3)
Maturity / final redemption date is on 3 December 2012
The trading of these units which are listed on the capital market segment of the NSE will automatically get suspended with effect from 29 November 2012.
ICICI Prudential MF Extends NFO Period of ICICI Prudential Capital Protection Oriented Fund III
NFO period will now close on 4 December 2012
Accordingly, Transfer cheques and Real Gross Settlement (RTGS) and MICR cheques will be accepted till the end of business hours upto 4 December 2012. Switch-in requests will be accepted upto 4 December 2012, till the cut-off time applicable for switches.
Tata Mutual Fund To Revise Load Structure Under Its Schemes
With effect from 29 November 2012
Accordingly, if redeemed on or before expiry pf 30 days from the date of allotment, the exit load charge will be 0.25% for Tata Dynamic Bond Fund – Plan A.
The exit load charge will be 0.25%, if redeemed on or before expiry of 7 days from the date of allotment for Tata Floating Rate Fund – Long Term Plan.
Asia Pacific Market: Rises as deal over Greek debt reached
Asia Pacific Stock markets were mostly in green on Tuesday, November 27,
2012, as news of a successful agreement on Greek bailout deal had
provided floor to the investors. The news sparked a wave of relief
buying across regional markets on sentiments that Greece will avoid a
messy default and exit from the eurozone for now.
The so-called troika (Euro-zone finance ministers, ECB and IMF have agreed on a plan to cut Greece ‘s sovereign debt to 124% of gross domestic product by 2020 and to less than 110% of GDP by 2022, clearing the way for the cash-strapped country to receive its next installment of a bailout loan.
Greece will receive up to EUR 44 billion in stages as it fulfills various conditions. The December installment will comprise of EUR 23.8 billion allocated for the banks and EUR 10.6 billion in budget assistance. Further, EUR 9.3 billion will be disbursed in installments during the first quarter of 2013 if Greece meets reform standards set by the EU.
The IMF Managing Director Christine Lagarde said in a statement that the initiatives include Greek debt buybacks and a lowering of some of the interest Greece pays on its aid. Taken together, these measures will help to bring back Greece ‘s debt ratio to a sustainable path and facilitate a gradual return to market financing.
Adding to bull, investment rationale also supported by ongoing ceasefire between Israel and Hamas. In the meantime, tensions have also eased in Egypt, wherein President Mursi is now negotiating with protesting judges in order to defuse the crisis over the contentious power seize.
However, rally on the upside were subdued across the regional bourses, as ambiguity over US fiscal cliff has dissuaded the traders from venturing in to aggressive positions. Investors shifted focus again on the US fiscal cliff, as negotiations have resumed after the Thanksgiving holiday, however the two political parties have not made any substantial breakthrough yet on the same.
Meanwhile, some investors opted sideline ahead of key US economic data later Tuesday, including durable goods orders as well as industry data on house price inflation. In addition, the Conference Board scheduled to publish data on U.S. consumer confidence, while Federal Reserve Chairman Ben Bernanke is to deliver brief remarks at the National College Fed Challenge Finals, in Washington D.C.
In the Asia Pacific markets on Tuesday, Australia ‘s All Ordinaries was up 0.7% and Japan ‘s Nikkei 225 Index rose 0.4%, while China ‘s Shanghai Composite fell 1.3% and Hong Kong ‘s Hang Seng fell marginal 0.1%. South Korea ‘s Kospi Composite jumped 0.9%, Singapore Strait Time ‘s index rose 0.3%, and Taiwan ‘s Taiex index rose 0.3%, while Indonesia ‘s Jakarta Composite dropped 0.9% and Malaysia ‘s KLSE Composite shed 0.6%. New Zealand ‘s NZX50 was edge 0.06% down. India ‘s BSE Sensex rose 1.6%.
Back to country wise performances, Australian shares rallied to a two-week high today after eurozone finance ministers and the International Monetary Fund agreed to release EUR 43.7 billion in loans to Greece. The benchmark S&P/ASX 200 index rose 32.6 points, or 0.7%, to 4456.8, its highest close since November 9 and building on a 0.3% gain on Monday, while the broader All Ordinaries index had firmed 29.9 points, or 0.67%, to 4473.4 points.
CSL surged 6.9% to a record close of A$50.01 after it forecast a 20% rise in full-year net profit, up from an earlier estimate of 12%, helped by a stronger sales as well as royalty income from cervical cancer vaccine Gardasil. The gain - the largest one-day rise for CSL in four years - made it the best performer among the ASX 200 companies and brings its year-to-date climb to 56%.
Qantas added 2.3%, extending gains for a second day on reports that a group of influential investors who have taken a small stake in the airline will meet with pilots to discuss an alternative growth strategy to the one being pursued by current management.
South Korea ‘s stocks closed higher too, with the KOSPI Composite index advanced 0.87% to 1,925.20, after the government ‘s decision to cut the limit on foreign-exchange forward positions in a move that would discourage taking on short-term foreign currency debt and could help stem the won ‘s appreciation, helping exporters. Kia Motors Corp rose 2.9% and Hyundai Motor Co. jumped 3.7%, while Samsung Electronics Co added 0.9%.
New Zealand ‘s shares fell marginally today despite some strong share price gains in certain stocks. Domestic share PGG Wrightson rose to the highest in more than a month after the sale of Fonterra units underlined the appeal of the rural sector, while Kiwi Income Property Trust fell after shedding its dividend. The NZX 50 Index fell 2.41 points, or 0.1%, to 4009.60, holding above 4000 for a third session. Within the index, 20 stocks rose, 18 fell and 12 were unchanged.
China ‘s stocks suffered heavy losses today, dragging the benchmark Shanghai Composite Index 1.3% down at1,991.17, while the Shenzhen Component Index dropped 2.3% to 771.28, with technology, industrials, realty, and resource related stocks led retreat, even after data showed acceleration in industrial profits growth last month, hurt by weak showing of Chinese ADR in the NYSE overnight and concerns about market liquidity.
The China ‘s Bureau of Statistics said on Tuesday morning that net earnings among Chinese industrial companies rose 20.5% from a year earlier last month to 500.1 billion yuan, registering a second month of gain in row. The profits in September rose by 7.8% on year, the first increase in six months. In the first 10 months, profits of Chinese industrial companies managed to grow 0.5% to 4.02 trillion yuan, reversing the contraction of 1.8% in the first three quarters.
Industrial companies and property developers tumbled today, with Sany Heavy slid 3.1% to 8.33 yuan. Yanzhou Coal Mining Co fell 4% to 16.06 yuan. Gemdale Corp lost 1% to 5.16 yuan.
Several chemical and pharmaceutical stocks too lost ground, with Harbin Pharmaceutical Group Co. was down 5.6% to 5.74 yuan. Zhejiang Xinan Chemical Industrial Group Co dropped 8.8% to 6.60 yuan and Chongqing Brewery Co skidded 6% to 14.52 yuan.
JiuGuiJiu locked 10% lower circuit for third straight day, falling to 34.69 yuan on reports liquor maker will suspend all production lines to replace equipment.
Hong Kong ‘s stocks closed lackluster trade slight weaker, with the benchmark Hang Seng index settled 0.1% down at 21,844.03 after moving in and out of boundary line, as negativity on tracking steep losses in Chinese bourses were more than offset by so-called Trioka approval for much awaited deal on Greece financial aid. Investors returned to the market with cheerful note today after talks over Greece ‘s financial crisis ended with an agreement on how to reduce its debt load, clearing the way for the cash-strapped country to receive the next installment of a bailout loan. But benchmark index steamed out earlier gains on tracking weakness in Chinese bourses, which fell steeply today despite official data showed industrial companies net profit accelerated sharply last month.
Among the 49 Hang Seng blue chips, 27 declined and 18 advanced, while 4 unchanged. Belle International Holdings declined 2.2% to HK$15.82, while China Resources Enterprise advanced 2.8% to HK$27.70 on prospect of JV with France-based Carrefour, making them the top blue-chip loser and gainer respectively. Market heavyweights were mixed, with HSBC Holdings was up 0.1% to HK$77.20. China Mobile was 0.1% down at HK$87.45. Esprit Holdings fell 2.1% to HK$12.32 on profit taking after consecutive days of gain.
India ‘s benchmark BSE Sensex closed 1.7% higher at 18,842.08, powered by heavy buying by funds and retail investors on the back of global cues. Positive statement from the Prime Minister on FDI in retail also provided support. The market sentiment was also boosted after credit rating agency Moody's said that the outlook on its Baa3 rating for India is stable. All BSE sectoral indices were in the green. Among them, Realty index, Consumer Durables, FMCG, and Bankex led the rally.
The logjam in the Parliament over FDI in retail stalled the winter session of Parliament for the fourth day. While the BJP and the Left were adamant on vote on FDI in retail under Rule 184, government allies Samajwadi Party, Bahunjan Samaj Party and DMK decided not to vote against FDI. Prime Minister Manmohan Singh said he was confident of getting support on FDI vote in Parliament.
The so-called troika (Euro-zone finance ministers, ECB and IMF have agreed on a plan to cut Greece ‘s sovereign debt to 124% of gross domestic product by 2020 and to less than 110% of GDP by 2022, clearing the way for the cash-strapped country to receive its next installment of a bailout loan.
Greece will receive up to EUR 44 billion in stages as it fulfills various conditions. The December installment will comprise of EUR 23.8 billion allocated for the banks and EUR 10.6 billion in budget assistance. Further, EUR 9.3 billion will be disbursed in installments during the first quarter of 2013 if Greece meets reform standards set by the EU.
The IMF Managing Director Christine Lagarde said in a statement that the initiatives include Greek debt buybacks and a lowering of some of the interest Greece pays on its aid. Taken together, these measures will help to bring back Greece ‘s debt ratio to a sustainable path and facilitate a gradual return to market financing.
Adding to bull, investment rationale also supported by ongoing ceasefire between Israel and Hamas. In the meantime, tensions have also eased in Egypt, wherein President Mursi is now negotiating with protesting judges in order to defuse the crisis over the contentious power seize.
However, rally on the upside were subdued across the regional bourses, as ambiguity over US fiscal cliff has dissuaded the traders from venturing in to aggressive positions. Investors shifted focus again on the US fiscal cliff, as negotiations have resumed after the Thanksgiving holiday, however the two political parties have not made any substantial breakthrough yet on the same.
Meanwhile, some investors opted sideline ahead of key US economic data later Tuesday, including durable goods orders as well as industry data on house price inflation. In addition, the Conference Board scheduled to publish data on U.S. consumer confidence, while Federal Reserve Chairman Ben Bernanke is to deliver brief remarks at the National College Fed Challenge Finals, in Washington D.C.
In the Asia Pacific markets on Tuesday, Australia ‘s All Ordinaries was up 0.7% and Japan ‘s Nikkei 225 Index rose 0.4%, while China ‘s Shanghai Composite fell 1.3% and Hong Kong ‘s Hang Seng fell marginal 0.1%. South Korea ‘s Kospi Composite jumped 0.9%, Singapore Strait Time ‘s index rose 0.3%, and Taiwan ‘s Taiex index rose 0.3%, while Indonesia ‘s Jakarta Composite dropped 0.9% and Malaysia ‘s KLSE Composite shed 0.6%. New Zealand ‘s NZX50 was edge 0.06% down. India ‘s BSE Sensex rose 1.6%.
Back to country wise performances, Australian shares rallied to a two-week high today after eurozone finance ministers and the International Monetary Fund agreed to release EUR 43.7 billion in loans to Greece. The benchmark S&P/ASX 200 index rose 32.6 points, or 0.7%, to 4456.8, its highest close since November 9 and building on a 0.3% gain on Monday, while the broader All Ordinaries index had firmed 29.9 points, or 0.67%, to 4473.4 points.
CSL surged 6.9% to a record close of A$50.01 after it forecast a 20% rise in full-year net profit, up from an earlier estimate of 12%, helped by a stronger sales as well as royalty income from cervical cancer vaccine Gardasil. The gain - the largest one-day rise for CSL in four years - made it the best performer among the ASX 200 companies and brings its year-to-date climb to 56%.
Qantas added 2.3%, extending gains for a second day on reports that a group of influential investors who have taken a small stake in the airline will meet with pilots to discuss an alternative growth strategy to the one being pursued by current management.
South Korea ‘s stocks closed higher too, with the KOSPI Composite index advanced 0.87% to 1,925.20, after the government ‘s decision to cut the limit on foreign-exchange forward positions in a move that would discourage taking on short-term foreign currency debt and could help stem the won ‘s appreciation, helping exporters. Kia Motors Corp rose 2.9% and Hyundai Motor Co. jumped 3.7%, while Samsung Electronics Co added 0.9%.
New Zealand ‘s shares fell marginally today despite some strong share price gains in certain stocks. Domestic share PGG Wrightson rose to the highest in more than a month after the sale of Fonterra units underlined the appeal of the rural sector, while Kiwi Income Property Trust fell after shedding its dividend. The NZX 50 Index fell 2.41 points, or 0.1%, to 4009.60, holding above 4000 for a third session. Within the index, 20 stocks rose, 18 fell and 12 were unchanged.
China ‘s stocks suffered heavy losses today, dragging the benchmark Shanghai Composite Index 1.3% down at1,991.17, while the Shenzhen Component Index dropped 2.3% to 771.28, with technology, industrials, realty, and resource related stocks led retreat, even after data showed acceleration in industrial profits growth last month, hurt by weak showing of Chinese ADR in the NYSE overnight and concerns about market liquidity.
The China ‘s Bureau of Statistics said on Tuesday morning that net earnings among Chinese industrial companies rose 20.5% from a year earlier last month to 500.1 billion yuan, registering a second month of gain in row. The profits in September rose by 7.8% on year, the first increase in six months. In the first 10 months, profits of Chinese industrial companies managed to grow 0.5% to 4.02 trillion yuan, reversing the contraction of 1.8% in the first three quarters.
Industrial companies and property developers tumbled today, with Sany Heavy slid 3.1% to 8.33 yuan. Yanzhou Coal Mining Co fell 4% to 16.06 yuan. Gemdale Corp lost 1% to 5.16 yuan.
Several chemical and pharmaceutical stocks too lost ground, with Harbin Pharmaceutical Group Co. was down 5.6% to 5.74 yuan. Zhejiang Xinan Chemical Industrial Group Co dropped 8.8% to 6.60 yuan and Chongqing Brewery Co skidded 6% to 14.52 yuan.
JiuGuiJiu locked 10% lower circuit for third straight day, falling to 34.69 yuan on reports liquor maker will suspend all production lines to replace equipment.
Hong Kong ‘s stocks closed lackluster trade slight weaker, with the benchmark Hang Seng index settled 0.1% down at 21,844.03 after moving in and out of boundary line, as negativity on tracking steep losses in Chinese bourses were more than offset by so-called Trioka approval for much awaited deal on Greece financial aid. Investors returned to the market with cheerful note today after talks over Greece ‘s financial crisis ended with an agreement on how to reduce its debt load, clearing the way for the cash-strapped country to receive the next installment of a bailout loan. But benchmark index steamed out earlier gains on tracking weakness in Chinese bourses, which fell steeply today despite official data showed industrial companies net profit accelerated sharply last month.
Among the 49 Hang Seng blue chips, 27 declined and 18 advanced, while 4 unchanged. Belle International Holdings declined 2.2% to HK$15.82, while China Resources Enterprise advanced 2.8% to HK$27.70 on prospect of JV with France-based Carrefour, making them the top blue-chip loser and gainer respectively. Market heavyweights were mixed, with HSBC Holdings was up 0.1% to HK$77.20. China Mobile was 0.1% down at HK$87.45. Esprit Holdings fell 2.1% to HK$12.32 on profit taking after consecutive days of gain.
India ‘s benchmark BSE Sensex closed 1.7% higher at 18,842.08, powered by heavy buying by funds and retail investors on the back of global cues. Positive statement from the Prime Minister on FDI in retail also provided support. The market sentiment was also boosted after credit rating agency Moody's said that the outlook on its Baa3 rating for India is stable. All BSE sectoral indices were in the green. Among them, Realty index, Consumer Durables, FMCG, and Bankex led the rally.
The logjam in the Parliament over FDI in retail stalled the winter session of Parliament for the fourth day. While the BJP and the Left were adamant on vote on FDI in retail under Rule 184, government allies Samajwadi Party, Bahunjan Samaj Party and DMK decided not to vote against FDI. Prime Minister Manmohan Singh said he was confident of getting support on FDI vote in Parliament.
Monday, November 26, 2012
ICICI Prudential Interval Fund II – Quarterly Interval Plan C Announces Dividend
Record date for dividend is 30 November 2012
ICICI Prudential Top 200 Fund Announces Dividend
Record date for dividend is 30 November 2012
Macroeconomic scenario remains clouded: ICRA
ICRA expect WPI inflation to average 7.5-7.7% in
FY13, while revised down its GDP growth forecast for FY13 to 5.4% from
previous expectation of 5.7%
Although measures such as the revision in the price of diesel and easing of norms for Foreign Direct Investment (FDI) in various sectors initiated since September 2012 boosted investor sentiments and aided in a strengthening of the Indian Rupee, the currency has weakened sharply in the past month, adding to macroeconomic uncertainties.
To an extent, a narrower-than-expected shortfall in south-west monsoon rainfall has assuaged concerns regarding food inflation. Nevertheless, an anticipated rise in food inflation in the coming months based on an adverse base effect and higher minimum support prices (MSP) for rabi crops would keep inflationary expectations elevated. Despite the considerable slowdown in economic growth over the last 15 months, core inflation remains above 5%. In our view, a weaker Rupee and a generalization of inflationary pressures related to high food prices would result in core inflation remaining firm. ICRA continues to expect WPI inflation to average 7.5-7.7% in FY13.
The pace of growth of real GDP at factor cost is likely to have eased to 5.0% in Q2FY13 from 5.5% in Q1FY13. While the weak monsoon onset and late sowing are likely to have dampened yields, heavy rainfall in mid-August to mid-September 2012 may have adversely impacted the standing crops. As against a 2% shortfall in sowing, the First Advance Estimates of Crop Production released by GoI indicate a 7% decline in the production of kharif crops, which suggests that growth of agriculture & allied activities is likely to be low in the second half of 2012.
The Index of Industrial Production (IIP) indicates a marginal upturn in the growth of the manufacturing and mining & quarrying sectors in Q2FY13. However, a moderation in growth of cement and steel output suggests a deceleration in construction growth in Q2FY12 relative to the previous quarter. As compared to the forecast of 3.0% industrial growth in H1FY12, a favorable base effect is expected to boost industrial growth to 5.4% in H2FY13. Lead indicators of service sector activity such as air passenger and cargo traffic; cargo handled at major ports; and railway revenue earning freight traffic suggest a mixed trend for Q2FY13.
Given the absence of a pickup in private investment activity despite an improvement in sentiments; low transmission of the reduction in the cash reserve ratio (CRR) since September 2012; expectations of back-ended cut in the Repo rate (reduction of 50 bps in Q4FY13); and moderating consumption demand, ICRA has revised its forecast for GDP growth for FY13 to 5.4% from the previous expectation of 5.7%.
GoI's fiscal deficit is expected to exceed the revised target of 5.3% of GDP in the current fiscal year, in light of the substantial under-recoveries on various regulated fuels already incurred in H1FY13; limited flexibility to control various types of expenditure; and the likelihood of both tax and non-tax revenue receipts falling short of the budgeted amount. Assuming that fuel subsidies for Q4FY13 are released in FY14 and disinvestment proceeds amount to Rs. 200-250 billion in FY13, GoI's fiscal deficit is expected to be around 5.6-5.7% of GDP in 2012-13, inferior to the revised target of 5.3% of GDP. ICRA expects the slippage in GoI's fiscal deficit relative to the Budget Estimates (BE) for 2012-13 to be funded by an enhancement in the announced long-term market borrowing programme for Q4FY13 by Rs. 400-500 billion.
Notwithstanding the impact of a weaker Rupee on competitiveness, demand for Indian exports is expected to remain muted in H2FY13, reflecting global economic conditions. Additionally, the impaired availability of power for industrial usage in some regions may constrain the ability of exporters to ramp up production levels. The unfavourable monsoon is expected to moderate the growth of agricultural incomes and rural demand for gold in 2012-13. Nevertheless, gold imports are expected to rise in H2FY13 relative to H1FY13, reflecting the festive season demand. Additionally, domestic supply constraints are expected to boost the demand for imports of items such as coal, natural gas and iron ore in 2012-13, enlarging non-oil imports. We have revised our expectation of the current account deficit for FY13 to USD 70 billion (3.8% of GDP), slightly higher than our previous forecast of USD 69 billion (3.7% of GDP).
A significant USD 22 billion of external commercial borrowings (ECBs), which accounted for around 30% of India's external debt of USD 350 billion at end-June 2012, is classified as short term debt by residual maturity, posing substantial refinancing risks for the Corporate sector. Additionally, the rise in short-term external debt and decline in reserves has contributed to deterioration in short-term debt by residual maturity to 52% of foreign exchange reserves at end- June 2012 from 42% at end-March 2011.
Considerable capital inflows are required to fund the current account deficit and refinance maturing external debt in the current fiscal year; the extent of capital inflows into India would be closely linked to both global trends regarding liquidity and risk aversion as well as investors' sentiments regarding Indian macro-economic fundamentals.
The Repo rate is likely to be reduced by a further 50 bps in the remainder of the current fiscal year, the timing of which would be guided by growth-inflation dynamics. At present, ICRA expects the Central Bank to reduce the CRR by 25 bps in the December 2012 mid-quarter policy review to ensure credit flow to productive sectors.
In the absence of substantial room for monetary easing in FY13 or fiscal space for enhancing public investment to stimulate economic growth, resolution of various regulatory issues and passing of key Legislations such as the proposed Land Acquisition, Rehabilitation and Resettlement Bill is vital to improve sentiments, boost investment activity and ease the supply-side pressures in the Indian economy.
Tara Jewels IPO subscribed 2 times
Gets bids for 1.35 crore shares
The initial public offer (IPO) of jewellery manufacturer and exporter Tara Jewels was subscribed 1.98 times. The IPO garnered bids for 1.35 crore shares as against 68.18 lakh shares on offer. The IPO remained open for bidding between 21 and 23 November 2012.
Categorywise, non institutional investors portion was subscribed 3.10 times followed by qualified institutional buyers (1.49 times) and retail individual investors (2.05 times).
The company had fixed the price band for the IPO at Rs 225-230 a share. The issue consisted of fresh issue of (Rs 10 face value) shares worth up to Rs 109.50 crore and an offer for sale of shares worth up to Rs 70 crore by Fabrikant H.K. Trading.
Tara Jewels on Tuesday, 20 November 2012, finalised allocation of 11.58 lakh equity shares to two anchor investors at Rs 230 per share, the top end of the Rs 225-230 IPO price band. Among anchor investors, Universities Superannuation Scheme (USSL) as trustee of Universities Superannuation Scheme and DB International Asia were allotted 4.35 lakh shares and 7.23 lakh shares of the company, respectively. The company garnered Rs 26.65 crore through the allocation to anchor investors.
Tara Jewels plans to utilise the IPO proceeds to meet the expenses of establishing retail stores and for repayment or prepayment of loans.
The company conducts jewellery retail operations in the domestic market under the brand 'Tara Jewellers' and currently has 30 existing stores spread mainly in west, central and north. The firm intends to launch 20 project stores across India by 31 March 2013.
The company has four manufacturing units, three in Mumbai and one in China. The company primarily exports to Australia, China, Canada, European Union, South Africa, UAE, UK, and US. Going forward, the company will explore export opportunities in South and Central America.
Care rating agency had assigned IPO grading of three to the Tara Jewels IPO, which indicates average fundamentals. The IPO grading is assigned on a five-point scale from one to five with five being the best.
Tara Jewels' consolidated net profit jumped 33% to Rs 54.12 crore on 22% growth in net sales to Rs 1399.09 crore in the year ended 31 March 2012 over the year ended 31 March 2011.
Saturday, November 24, 2012
Tata MF Announces Dividend For Tata Fixed Income Portfolio Fund – Scheme B2 – Plan A
Record date for dividend is 29 November 2012
Goldman Sachs MF Announces Change In Fund Manager
With effect from 23 November 2012
IDFC MF Announces Dividend Under Its Schemes
Record date for dividend is 29 November 2012
IDFC Arbitrage Fund-Plan A & Plan B: Rs 0.05 per unit
IDFC Asset allocation Fund of Fund-Conservative Plan: Rs 0.03 per unit
IDFC Asset allocation Fund of Fund-Aggressive Plan: Rs 0.07 per unit
IDFC Asset allocation Fund of Fund-Moderate Plan: Rs 0.06 per unit
IDFC Super Saver Income Fund – Medium Term Plan A (Bimonthly dividend option): Rs 0.1369 per unit.
Birla Sun Life Fixed Term Plan – Series DT Announces Dividend
Record date for dividend is 29 November 2012
The maturity date of the scheme shall be on 29 November 2012. Accordingly, trading of units of aforesaid scheme will automatically get suspended on the stock exchange(s), where the units of aforesaid scheme are listed, with effect from 26 November 2012.
UTI MF To Revise Load Structure of UTI - Credit Opportunities Fund
With effect from 26 November 2012
Accordingly, if exited less than or equal to 365 days, the exit load charge will be 1.25%.
If exited greater than 365 days and less than or equal to 548 days, the exit load charge will be 0.75%.
If exited greater than 548 days, the exit load charge will be Nil.
DSP BlackRock MF Announces Change In Fund Management Responsibilities
With effect from 26 November 2012
Accordingly, DSP BlackRock Strategic Bond Fund will be solely managed by Dhawal Dalal and DSP BlackRock MIP Fund & DSP BlckRock Balanced Fund will be jointly managed by Apoorva Shah & Dhawal Dalal.
Friday, November 23, 2012
LIC gets nod to buy 30 per cent in companies
| The government has allowed India’s largest insurer Life Insurance Corporation (LIC) to invest up to 30% in a company as against the earlier limit of 10 per cent. "LIC can invest up to 30 per cent of a company’s paid-up capital. Earlier it could invest up to 10 per cent," said DK Mittal, financial services secretary in the finance ministry. The government will also announce a recapitalisation plan for banks and is considering of doing it through rights issue. |  |
The new investment rules have not gone down well with the sector regulator Insurance Regulatory and Development Authority (IRDA), but LIC managing director S Sarkar played down the differences. "Even before IRDA regulations came, we had the flexibility of going up to 30 per cent but we never did. When new financial institutions were being set up, which were pioneers in the country like Stock Holding Corporation of India and National Stock Exchange, we always remained within the prudential limit," Sarkar said.
"We follow Irda regulations in letter and spirit except in case where we had separate dispensation for us and we have no desire to go far away from Irda". Another senior LIC official clarified that new norms will allow the insurer to invest up to 25 per cent in listed companies and up to 30 per cent in unlisted firms. "We will not reach or cross 25 per cent stake in listed firms as it may lead to the trigger as per Sebi norms," he said. In 2011, the Securities and Exchange Board of India had notified that an entity buying 25 per cent stake in a listed firm will have to mandatorily make an open offer to buy an additional 26 per cent shares from the public.
The relaxation is expected to help the government achieve its 30,000-crore divestment target, as the new norms will allow LIC to deploy its funds to buy stock of state-run firms. LIC aims to invest around 50,000 crore in equities this fiscal. On the issue of bank capitalisation, the financial services secretary said the government will soon prepare a plan that could include a rights issue option. "We will finalise recap for banks soon," Mittal said, adding that if government opts for rights issue for banks, it will be done for all banks.
SBI has said it would prefer capitalisation through a rights issue. The government aims to infuse around 15,888 crore this fiscal in state-run banks wherein it has committed to maintain at least 58 per cent holding. The top three banks requiring capital are IOB, CBI and the Bank of Maharashtra. At an Assocham function on Wednesday, Indian Overseas Bank CMD M Narendra said that they have asked for 1,500 crore from government.
source: ET
New India to hike health cover rates
| New India Assurance Company, the country’s largest non-life insurer, will be increasing the premium rates for its health insurance product. The insurer has filed a revised version of its health insurance policy with an increase in premium rates. G Srinivasan, chairman and managing director, New India, while announcing the company’s financial results for the first half of the year, said, “Last revision in health insurance premium rates was in 2007. |  |
In the past five years, we have not increased the premium on our health insurance product despite medical costs rising by 8-10 per cent annually. Therefore, we have recently filed for revision in the health insurance premium rates with the insurance regulator and are hopeful to launch the (revised health insurance) product soon.” Srinivasan refused to give details on the amount of revision and the change in the features of the product that will be launched. The insurance company has been able to curtail the loss ratio in the health insurance business to 88 per cent in the first half of the current financial year, from 104 per cent in the same period last year.
The firm is targeting to lower the loss ratio in its health portfolio to 80 per cent by the end of this financial year. However, the loss ratios in motor and fire business are rising. New India Assurance controls around 15 per cent of the insurance market. Speaking about the plans of the public sector insurers to have a common third-party agent (TPA) company, Srinivasan said, that besides New India Assurance, the other three other general insurers – Oriental Insurance, National Insurance, United India Insurance, domestic reinsurer General Insurance Corporation and public sector behemoth Life Insurance Corporation will have a stake in the company. “The common TPA company will be launched in four to six months time,” said Srinivasan.
For the first half of FY13 ended September 30, New India reported a 216 per cent rise in net profit at Rs 205.08 crore, compared with a net profit of Rs 95 crore in the same period of FY12. The net profit resulted from profits in its investment income as the company registered an underwriting loss of Rs 1,122 crore for the first half of the FY13, compared with an underwriting loss of Rs 1,069 crore in the same period last year. For the first half of FY13, its domestic business grew at 15 per cent to almost Rs 5,000 crore and foreign operations saw a growth of 34.14 pr cent.
The growth in domestic business came largely from selling retail covers (selling health and motor policies). The insurance company is targeting to open 300 new offices in the country, of which, it has already opened 264 offices.
ICICI Lombard rolls out overseas travel insurance plan
Private sector general insurer ICICI Lombard today
launched ’International Travel Insurance Plan’ which provides overseas
medical insurance. "We have launched this product keeping in view that
number of international travellers from India is increasing.
Apart from medical insurance, this policy covers a host of other risks like political ones, catastrophic evacuation, emergency financial assistance, and home insurance cover," its vice-president for underwriting and claims Amit Bhandari said. He also said the company has tied up with US-based healthcare provider United Health Care (UHC) to take care of bill settlement directly, along with cashless hospitalisation across a wide network of hospitals.
Total premium collected in travel insurance segment in the country stood at only Rs 400 crore in the last fiscal. ICICI Lombard is the largest private sector insurer which had a gross written premium (GWP) of Rs 5,358 crore last fiscal.
Apart from medical insurance, this policy covers a host of other risks like political ones, catastrophic evacuation, emergency financial assistance, and home insurance cover," its vice-president for underwriting and claims Amit Bhandari said. He also said the company has tied up with US-based healthcare provider United Health Care (UHC) to take care of bill settlement directly, along with cashless hospitalisation across a wide network of hospitals.
Total premium collected in travel insurance segment in the country stood at only Rs 400 crore in the last fiscal. ICICI Lombard is the largest private sector insurer which had a gross written premium (GWP) of Rs 5,358 crore last fiscal.
Source : PTI
PSU insurers set to hike health insurance premiums
Health insurance premiums are set to rise with
public sector insurance companies seeking a revision of rates on
individual policies. Market-leader New India Assurance has already filed
new rates for which it is seeking approval. "Our present rates were
fixed five years ago and the old rates haven’t kept up with medical
inflation," said G Srinivasan, chairman, New India Assurance.
He said that the company was successful in bringing down the ratio of incurred claims to premium from 104% to 88% due to measures such as having a ’preferred’ provider network of hospitals that agree to the insurer’s schedule of rates. According to Srinivasan, the company would like to bring down further the incurred claims ratio to 80%.
Also, rates have been hiked on group mediclaim policies. But unlike group policies that are customized products, individual health plans are standard over-thecounter plans and need to be cleared by the regulator. Insurers say that health rates need to be revised because of sector regulator IRDA’s insistence that all health plans be made renewable for a lifetime.
Although New India Assurance managed to generate a profit after tax of Rs 205 crore for the half year ended September 2012, up 216% from last year, this is largely on the back of an investment income of Rs 1,342 crore.
He said that the company was successful in bringing down the ratio of incurred claims to premium from 104% to 88% due to measures such as having a ’preferred’ provider network of hospitals that agree to the insurer’s schedule of rates. According to Srinivasan, the company would like to bring down further the incurred claims ratio to 80%.
Also, rates have been hiked on group mediclaim policies. But unlike group policies that are customized products, individual health plans are standard over-thecounter plans and need to be cleared by the regulator. Insurers say that health rates need to be revised because of sector regulator IRDA’s insistence that all health plans be made renewable for a lifetime.
Although New India Assurance managed to generate a profit after tax of Rs 205 crore for the half year ended September 2012, up 216% from last year, this is largely on the back of an investment income of Rs 1,342 crore.
Source : TNN
Tata Fixed Income Portfolio Fund – Scheme C3 Announces Dividend
Record date for dividend is 26 November 2012
The rate of dividend per unit on the face value of Rs 10 per unit will be entire returns generated between 23 May 2012 to 26 November 2012, under each option.
Religare MF Announces Dividend Under Religare Fixed Maturity Plan – Series X – Plan E (371 Days)
Record date for dividend is 27 November 2012
Further, 27 November 2012, has been fixed as the record date for the purpose of determining eligible unit holders holding units of the scheme who would be entitled to the maturity/redemption proceeds on the maturity/final redemption date of the scheme, which is 27 November 2012.
DSP BlackRock MF Announces Maturity of DSP BlackRock FMP – Series 20 – 12 M
The maturity / final redemption date of the scheme is on 26 November 2012
DSP BlackRock Mutual Fund has announced that the record date for the purpose of determining the eligible unit holders/beneficial owners holding units (in demat form) of DSP BlackRock FMP – Series 20 – 12M, a closed-ended income scheme, who would be entitled to the maturity/redemption proceeds on the maturity/final redemption date shall be 22 November 2012.
The maturity/final redemption date of the scheme is on 26 November 2012 or the immediately following business day, if such day is not a business day.
The trading of the Units of the Scheme, which are listed on the Capital Market Segment of Bombay Stock Exchange (BSE), will get suspended and no off-market transactions shall be permitted by the Depositories (NSDL / CDSL) with effect from 21 November 2012.
DSP BlackRock Mutual Fund has announced that the record date for the purpose of determining the eligible unit holders/beneficial owners holding units (in demat form) of DSP BlackRock FMP – Series 20 – 12M, a closed-ended income scheme, who would be entitled to the maturity/redemption proceeds on the maturity/final redemption date shall be 22 November 2012.
The maturity/final redemption date of the scheme is on 26 November 2012 or the immediately following business day, if such day is not a business day.
The trading of the Units of the Scheme, which are listed on the Capital Market Segment of Bombay Stock Exchange (BSE), will get suspended and no off-market transactions shall be permitted by the Depositories (NSDL / CDSL) with effect from 21 November 2012.
ICICI Prudential MF Announces Dividend Under Two Schemes
Record date for dividend is 26 November 2012
ICICI Prudential Fixed Maturity Plan Series 60-1 Year Plan D: Rs 0.05 per unit
ICICI Prudential Interval Fund-Quarterly Interval Plan I:
Retail: Rs 0.1940 per unit
Institutional: Rs 0.2012 per unit
Retail Quarterly Dividend Payout: Rs 0.1939 per unit.
ICICI Prudential Fixed Maturity Plan Series 64 – 180 Days Plan E Announces Dividend
Record date for dividend is 27 November 2012
The quantum of dividend will be entire distributable surplus as on the record date. The scheme recorded NAV of Rs 10.4529 per unit as on 20 November 2012.
DSP BlackRock MF Announces Alternative Transaction Platform of DSP BlackRock Money Manager Fund
With immediate effect
Franklin Templeton MF Announces Change In Fund Management Responsibilities
With effect from 23 November 2012
Accordingly, Templeton India Growth Fund will be managed by Chetan Sehgal and Templeton India Equity Income Fund will be jointly managed by Chetan Sehgal and Vikas Chiranewal.
Tuesday, November 20, 2012
Short term strategies of Stock Investing
There was a research conducted in
United States on the average number of days investors hold the stock. The
number was 187 (about 6 months) in 1991-1996 period. The median was worse with
just 90 days. With internet boom era and overpriced IPOs in 2000s, this came
down to about 3 months. There is no data available for Indian market but
looking at the volatility of our stock market, the numbers will be very close
or even less.
This tells us there are mostly short term traders in the market. Is there anything wrong with short term trading? Absolutely not, but investors should know the rules of the game before they trade short term. Apart from knowing the rules, investors should also understand that short term trading mostly relies on luck and on study, which at best can be termed speculative.
In the current volatile market scenario, you could be tempted to try your luck in some short term investment strategies to make the best out of a bad situation. Here is an understanding of some short term trading strategies usually followed by short term traders. Knowing these strategies will make you aware of your own actions. However, do proceed with caution.
Day-trade in stocks
In this trading style, traders buy and sell the stocks on the same day or in a very short period of time. The traders take advantage of daily market volatility to profit. They buy when the stock prices go down hoping the prices to appreciate in the day. They square-off by the end of the day. This can result in profit or loss depending on whether the price they sold at was higher or lower than their buy price. This is a very popular way to trade. The popularity stems from the fact that this looks exciting. Even if traders lose money, the loss doesn’t seem big as daily variation is not very volatile.
Day-trading, however, is the most popular way to lose money. Majority of day-traders either lose money or do not make better than a long term investor. Investors look at daily loss and assume that this is not a big loss but accumulate the losses for the year and they can see the big picture.
Take an example. If I have 1 lakh and I gamble, I will be happy to earn Rs 2000 from my gamble. However, I will not be too worried if I lose Rs 2000. This psychology works against traders. The happiness to get marginal profit is more than the sorrow of suffering a marginal loss. Take another example. A buyer goes to a showroom and to buy a car worth 3 lakh. At the last moment, he comes to know that the seller is giving Rs 6000 coupon free to be spent in lifestyle. At the same time, another buyer goes to another shop and buys the car at 2 lakh and 94000 rupees. Both come out of the shop. Whom do you think will have bigger smile?
Risk mitigation
Investors should not put all their money in day-trading. If you are too excited by daily price volatility and want to try your hands in day-trading, put at most 10% of your total investment for this and play with this. Do not gamble more.
Trading on margin
In margin trading, the investor spends some part from his or her pocket and borrows the rest from the broker at an interest. In this context, investors have to understand the concept of initial and maintenance margin. Initial margin is the % of total investment that investors have to put. When the prices go down, your contribution in terms of percentage will go down. After it goes below a certain percentage, the broker will ask you to put more money to take it to the initial margin. This “certain percentage” is called maintenance margin.
Take an example. Let’s say an investor, Rakesh buys 100 stock of Airtel at Rs 400 a share. The initial margin is 25% and maintenance margin is 10%. This means Rakesh has to put 10,000 (25% of total investment of 40,000). The rest 30,000 is borrowed by broker. Suppose the prices start going down and goes to Rs 330 a share. In this case, the total value is 330*100 = Rs 33,000. Let’s calculate what the contribution by investor at this point is. The investor contribution is (33000-30000)/33000. This is less than 10%. Hence investor will get a call to put more money so that his or her contribution is 25% of Rs 33000 which is Rs 8250. Since his amount is 3000, he will have to deposit another 5250.
This is high risk high return strategy. The advantage is that if the prices go up, you earn all the profit minus the interest you pay to the broker on his contribution. However, the loss is equally yours because the broker will anyway charge the interest. This is a double whammy.
Risk Mitigation
The only risk mitigation strategy is that the investors should never put more money when margin call is given by the broker. The investor, instead, should ask the broker to square off the position with whatever loss has happened. Avoid the temptation to put more money after the margin call.
Selling short
In this short term strategy, investors borrow and sell the shares and later they have to buy this from open market and give it back to the lender. The idea is to benefit from decreasing prices. Investors short-sell stocks because they assume that prices will go down and when it goes down they buy it cheaper and give it back. The difference is the profit to investors.
Take an example. An investor Rakesh expects the price of Airtel with current market price @400 to go down. Since he has no stocks, he borrows 100 Airtel stocks from the market and sells it immediately earning 40,000. After sometime, as he expected, the Airtel price went down to 350. He buys 100 stocks back at 35,000 and gives it back. He earns Rs 5000 from this transaction. We are ignoring transaction costs and other charges for the sake of simplicity.
Risk mitigation
Short-selling is speculative in nature and investors may lose if the prices go up. There is no guarantee that stocks will go down as expected. There are other ways to mitigate the risk by using derivatives but those are out of scope of this article. If you are keen on doing it, use a very small amount (less than 10% of your investment) for short-selling.
Finally
Short term is tempting to investors. Short term trading offers excitement, action, and instant gratification. Compared to this, long term is boring, tedious, and requires extreme patience.
This tells us there are mostly short term traders in the market. Is there anything wrong with short term trading? Absolutely not, but investors should know the rules of the game before they trade short term. Apart from knowing the rules, investors should also understand that short term trading mostly relies on luck and on study, which at best can be termed speculative.
In the current volatile market scenario, you could be tempted to try your luck in some short term investment strategies to make the best out of a bad situation. Here is an understanding of some short term trading strategies usually followed by short term traders. Knowing these strategies will make you aware of your own actions. However, do proceed with caution.
Day-trade in stocks
In this trading style, traders buy and sell the stocks on the same day or in a very short period of time. The traders take advantage of daily market volatility to profit. They buy when the stock prices go down hoping the prices to appreciate in the day. They square-off by the end of the day. This can result in profit or loss depending on whether the price they sold at was higher or lower than their buy price. This is a very popular way to trade. The popularity stems from the fact that this looks exciting. Even if traders lose money, the loss doesn’t seem big as daily variation is not very volatile.
Day-trading, however, is the most popular way to lose money. Majority of day-traders either lose money or do not make better than a long term investor. Investors look at daily loss and assume that this is not a big loss but accumulate the losses for the year and they can see the big picture.
Take an example. If I have 1 lakh and I gamble, I will be happy to earn Rs 2000 from my gamble. However, I will not be too worried if I lose Rs 2000. This psychology works against traders. The happiness to get marginal profit is more than the sorrow of suffering a marginal loss. Take another example. A buyer goes to a showroom and to buy a car worth 3 lakh. At the last moment, he comes to know that the seller is giving Rs 6000 coupon free to be spent in lifestyle. At the same time, another buyer goes to another shop and buys the car at 2 lakh and 94000 rupees. Both come out of the shop. Whom do you think will have bigger smile?
Risk mitigation
Investors should not put all their money in day-trading. If you are too excited by daily price volatility and want to try your hands in day-trading, put at most 10% of your total investment for this and play with this. Do not gamble more.
Trading on margin
In margin trading, the investor spends some part from his or her pocket and borrows the rest from the broker at an interest. In this context, investors have to understand the concept of initial and maintenance margin. Initial margin is the % of total investment that investors have to put. When the prices go down, your contribution in terms of percentage will go down. After it goes below a certain percentage, the broker will ask you to put more money to take it to the initial margin. This “certain percentage” is called maintenance margin.
Take an example. Let’s say an investor, Rakesh buys 100 stock of Airtel at Rs 400 a share. The initial margin is 25% and maintenance margin is 10%. This means Rakesh has to put 10,000 (25% of total investment of 40,000). The rest 30,000 is borrowed by broker. Suppose the prices start going down and goes to Rs 330 a share. In this case, the total value is 330*100 = Rs 33,000. Let’s calculate what the contribution by investor at this point is. The investor contribution is (33000-30000)/33000. This is less than 10%. Hence investor will get a call to put more money so that his or her contribution is 25% of Rs 33000 which is Rs 8250. Since his amount is 3000, he will have to deposit another 5250.
This is high risk high return strategy. The advantage is that if the prices go up, you earn all the profit minus the interest you pay to the broker on his contribution. However, the loss is equally yours because the broker will anyway charge the interest. This is a double whammy.
Risk Mitigation
The only risk mitigation strategy is that the investors should never put more money when margin call is given by the broker. The investor, instead, should ask the broker to square off the position with whatever loss has happened. Avoid the temptation to put more money after the margin call.
Selling short
In this short term strategy, investors borrow and sell the shares and later they have to buy this from open market and give it back to the lender. The idea is to benefit from decreasing prices. Investors short-sell stocks because they assume that prices will go down and when it goes down they buy it cheaper and give it back. The difference is the profit to investors.
Take an example. An investor Rakesh expects the price of Airtel with current market price @400 to go down. Since he has no stocks, he borrows 100 Airtel stocks from the market and sells it immediately earning 40,000. After sometime, as he expected, the Airtel price went down to 350. He buys 100 stocks back at 35,000 and gives it back. He earns Rs 5000 from this transaction. We are ignoring transaction costs and other charges for the sake of simplicity.
Risk mitigation
Short-selling is speculative in nature and investors may lose if the prices go up. There is no guarantee that stocks will go down as expected. There are other ways to mitigate the risk by using derivatives but those are out of scope of this article. If you are keen on doing it, use a very small amount (less than 10% of your investment) for short-selling.
Finally
Short term is tempting to investors. Short term trading offers excitement, action, and instant gratification. Compared to this, long term is boring, tedious, and requires extreme patience.
However, there is no way to build
wealth but by using long term strategies. This is true for most of the
investors. There are short term investors who have done tremendously well but
they are few and far between. Hence investors should put their major portion of
investment corpus for long term wealth building assets and segregate a minor
portion for short term speculation.
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