Objective

The objective of this scheme would be to invest up to 65% in equities and its related instruments while the balance up to 35% in gold ETF schemes available in India.  Thereby giving an added advantage of giving gold as a hedge against inflation even if the equities were not doing so well.

Asset Allocation

From 65% to 8% in equities and related instruments.  15% to 35% in gold ETFs.  0 to 20% in fixed and money market instruments.  The portfolio of this scheme will be rebalanced according to the valuation levels prevailing between the 3 investment opportunities available with this fund.

Options Available

Growth and dividend options (both payout and reinvestment)

Minimum Investment

The minimum investment amount to invest in this fund is Rs. 5000 and in multiples of Rs. 1 thereafter.  The minimum installment amount via SIP would be Rs. 250 per month.  No entry load applicable for this fund while there is a 1% exit load if redeemed or switched within 1 year of allotment of units.

There are very similar funds that have come up in the market like the Canara Robeco Indigo Fund.  This fund’s methodology can be ideal for those looking for an alternative portfolio with equities and gold investment via one fund.  But also remember that there will be additional charges involved due to the FOF mode of investment via the Gold ETF option of its 35% of investment portfolio.

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This is an open ended Fund of Fund which is going to be invested only on the Quantum Gold Fund Exchange Traded Fund which in fact is one of the early starters when it comes to gold ETF funds in India.  By the way the Quantum Gold Fund ETF’s each unit has the value of half gram as against the 1 gram being followed by other MFs.  You don’t need to have a DEMAT account to invest in this gold fund as you can invest in it in lumpsum or via SIP route just like any other regular Mutual Funds.  The Systematic Investment Plan (SIP) is available only when the scheme reopens though.

NFO

The current NFO is open from April 28, 2011 and closes on May 12, 2011 and the same will be reopened on May 26, 2011.

Details

As said above, Quantum Gold Savings Fund is an opened ended Fund of Fund Scheme investing mainly only at the Quantum Gold ETF fund.

Objective

The key objective of this fund is to derive capital gain by way of investing solely in Quantum Gold Exchange Traded Fund (ETF).  The benchmark of this fund is going to be domestic gold price.

Entry and Exit Load: There is not entry load for this fund but there will be a 1.5% exit load if there is redemption or switching within 1 year of allotment of the fund’s units.

Asset Allocation

Up to 95% in Quantum Gold Fund and the balance 0-5% in money market and debt instruments offered by government companies.

Minimum Investment

The minimum amount that you can invest in this Quantum Gold Savings Fund is Rs. 500 and in multiples of Rs. 1 thereafter.  There is only going to be growth option with this fund and no dividend option is available.

SIP

The main advantage of investing in such gold funds is the beauty of being able to invest in gold via the SIP option which is otherwise not possible in regular Gold ETF conventionally, but you can buy them every month at least 1 g of gold via your demat account though.   Quantum Gold Savings Fund has five types or frequencies of SIP namely daily, weekly, fortnight, monthly and quarterly SIPs.  The minimum amount of investment for daily SIP is Rs. 100 while for the others the minimum amount to invest is Rs. 500 and in multiples of Rs. 1.  You can also opt for the Systematic Transfer Plan (STP) or the Systematic Withdrawal Plan (SWP) with this gold fund.

This Quantum Gold Savings Fund (QGSF) is an excellent opportunity for those who don’t have a DEMAT account to buy the regular gold ETFs but have always been wanted to invest in gold on a monthly basis!  Although they have mentioned an annual recurring expense of 0.5% there have been reports that there is not going to be any management fee that is going to be charged for this fund except for the charges being incurred on Quantum Gold ETF.  Hence it could prove to be an additional benefit when you compare it with the Reliance Gold Savings Fund where you get double charges on your investments.  But according to the Quantum Gold Fund’s prospectus there will not be any annual recurring expenses taken from the investors but it will be borne by the AMC and also they will not charge any investment management fee for this particular fund and hence making it an ideal choice for those looking for SIP route to invest in gold.

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Benchmark: The actual benchmark that this fund follows is the Crisil MIP Blended Index.

Asset Allocation: 80-95% in debt and money market instruments, 5-20% in equities.

Options Available: Dividend payout and growth option.

NFO Details: The minimum investment is Rs. 5000 and in multiples of Rs. 1 thereafter.  There is a lock-in period of 3 years.  There is no entry or exit load for this fund as it will be listed in stock exchange.

The dual benefits work like giving stability and fixed returns from the debt portion of the investment and the equity portion will help you achieve the extra push needed for the additional income.  Apart from that this fund also helps you gain the indexation benefits for those in the higher tax bracket!  The 3 year lock in period helps the fund managers to get their call with a long term view and hence enhanced returns can be achieved.

The debt portion of this Reliance Dual Advantage Fund will be invested in the highest of quality debt and money market instruments while the equity part will be invested across the broad based portfolio of stocks.

This fund (Reliance Dual Advantage Fixed Tenure Fund I) looks like just another capital protection oriented fund but comes with a different name!  As, we have not been receiving not so too good reviews about the capital protection oriented funds, hence think twice before going for this NFO.  If you are really looking for stability and extra push on the equities, go ahead and try this fund else give it a miss.

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Ratings
This Religare Capital Protection Fund comes with mfAAA (so) rating by ICRA Limited which indicates highest degree of payment certainty especially for the face value of the MF units during maturity of the fund.

Fund Objective

To help you achieve maximum growth by way of investing up to 20% of your investment amount in equities related instruments while trying to protect the capital by way of investing the balance 80% of investment in the debt and other money market instruments.

Asset Allocation

As said above the 80% of the investment made at Religare Capital Protection Oriented Fund Series I will be made on the money market and debt market instruments while the balance 0-20% will be invested on stock market (equities) to help achieve additional gains for your investment.

Benchmark

The benchmark of this fund is CRISIL MIP Blended Fund Index.

Minimum Investment

The minimum investment during the NFO period is Rs. 5000 and in multiples of Re. 1 thereafter.  The NAV during the NFO will be Rs. 10 per unit.  There will be no entry or exit load for this fund, since being a closed ended MF plan.

If you are looking for a fund which offers you an opportunity to earn some extra gains when compared to investing in the regular debt funds or fixed deposits then you can go ahead and try this Religare Capital Protection Fund else just give it a slip this time, instead you can try the regular FMP funds or the regular balanced fund from the top mutual fund AMCs.

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Kotak Gold Fund NFO

The Kotak Gold Fund is an open ended Fund of Funds scheme (FOF) that is going mostly going to invest in the Kotak Gold ETF.  For the liquidity purposes this fund will also invest in short term fixed deposit, money market instruments, etc.  The NFO is open from March 4, 2011 and it closes on March 18, 2011.  The reopening of this FOF is from April 5, 2011 in which you can buy the units as regular MF units.  The benchmark index for this fund is physical gold price.  Mr. Abhishek Bisen is the fund manager.

Gold being an excellent hedge against inflation can prove to be an ideal investment and surely has never disappointed in terms of returns for the investors.

Benefits of Kotak Gold Fund

• No need of demat account – Unlike the gold ETFs which compulsorily asks for a demat account to buy and sell, this Kotak Gold Fund does not need Demat account to buy.
• Buy Gold via SIP – Till now there was no option or choice or plan available for us to buy gold via SIP, but with this Kotak Gold Plan one can just give the standing instruction of as little as Rs. 1000 and continue for life long
• Liquidity – Unlike the real gold coins or bars the liquidity of Kotak Gold is very high you can sell the units on any business day and get the cash in your account within a day or two.
• Taxation – There are also taxation benefits as there is no wealth tax applicable if you buy gold via Mutual Funds.
• Low Cost – When compared with buying gold as jewellery, coins or bars.

Objective: The key objective of Kotak Gold Fund (KGF) is to generate income by way of investing in gold via the Kotak Gold ETF (KGEFT).

Asset Allocation: Up to 95% in gold (in KGEFT) and the balance 5% in money market, short term FD, CBLO or liquid schemes.

Minimum Investment: For regular purchase the minimum investment amount is Rs. 5000 and in multiples of Re. 1.  For SIP purchase the minimum monthly investment is Rs. 1000 (unlike Reliance Gold Savings Fund for which the minimum SIP amount being Rs. 100!).  The NAV of this fund will be Rs. 10 per unit during the NFO.

Investment Options: Growth and Dividend (reinvestment and payout).

Entry and Exit Load: There is no entry load for this fund but there is a 2% exit load if redeemed or switched within 6 months and 1% if redeemed between 6 months to 1 year.  While there is no exit load if redeemed or switched after 1 year of investment.

Expense Rate: This fund carries a double expense rate whereas the maximum total expenses for maintenance of this fund will be 1.50% as well as you should remember to add in the expenses of the Kotak ETF which may add up to 2.50% which makes the approximate total expense to invest in this gold fund as 3.5% which indeed is very high fee that you had to pay for investment in gold!

Hence think about these expenses and other factors and then decide about investing in Kotak Gold Fund.  My advice would be that if you have a demat account then you can go ahead and purchase the units of gold there itself rather than opting for this fund.  Else if you may not have time or patience to buy regularly from Gold ETFs then you can try this fund but try via the SIP option and see how good it performs if not then exit accordingly.

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Objective

The SBI Capital Protection Oriented Fund – Series 2 comes with an objective of investing in equity, debt and money market instruments as well as following a pattern in which it will help you protect your capital by investing 74 to 100% in debt and money market instruments.  It helps in protection of your capital but still giving an opportunity to help your money grow by investing some part in equities.  They will invest the debt portion only in the AAA or P1+ or equally rate schemes and hence security is assured.

Asset Allocation

Investing 0-26% in equities (market capitalized stocks of the BSE 100 Index) and equity related products and 74% to 100% in debt, debt related and money market instruments.

Minimum Investment

The minimum amount that you can invest in SBI Capital Protection Oriented Fund Series 2 during the NFO is Rs. 5000 and in multiples of Rs.1 thereafter.

Loads Structure

There is no entry as well as exit load for this particular NFO is nil.

Tax Efficiency

You can avail the indexation benefit and better returns post tax.  The long term capital gains will bear a tax of 20% with the the indexation benefit or the 10% without the indexation benefit.

Although many of them are skeptical about such capital protection oriented fund, but still if you are looking for the investment for long term horizon (say 5 years) but are afraid about investing directly in equities, you can try this fund where your capital is almost protected by investing in debt instruments while the 24% of your investment is tried at various equities in stock markets.  Although they are not guaranteeing any assured returns or not guaranteeing your capital protection, you should be well aware of the fact that just like any other mutual fund investments this fund too carry equal amount of risk and hence think about the same and invest in it.

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The Sundaram Capital Protection Oriented Fund Series 2 is a closed-ended capital protection oriented scheme with the NFO open till February 28, 2011 and you can buy units at Rs. 10 per unit.

Asset Allocation and Protection: This fund ensures that your capital protected by investing at least 70% of your investment in fixed income securities while investing.  These investments comprises of only AAA rated government securities and hence the capital protection is guaranteed for up to 70% which will give you an yield of your total capital as well as at least 5.31% in return.  While the balance 30% of your investment will be invested in S&P CNX 500 Index based stocks, i.e., in equities so that you can expect better returns on your overall investment (70% debt + 30% equities).

Ratings: This NFO from Sundaram comes with AAA (so) rating from CRISIL which indicates highest degree of certainty in terms of payment of your returns (face value) back to the investors.

Minimum Investment: Is Rs. 5000.

Entry and Exit Load: There will be no entry or exit load since being a close ended fund with a lock-in period of 5 years.

How this fund will help you boost your returns:

This NFO of Capital Protection Oriented Fund from Sundaram will be ideal for those who are looking for capital safety as well as want to enter stock markets in a moderate manner but since being a closed-ended fund, of at least 5 years, liquidity is not worth looking at for this fund.  If you can go away with your savings for at least 5 years without needing to use it, then you can try this fund.  But remember that they are not assuring or guaranteeing you with your capital as there are some unexpected risks that can be associated with this fund just like any other debt funds!

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