| S&P BSE Sensex* |
Re/US $ |
Gold Rs/10g |
Crude ($/barrel) |
FD Rates (1-Yr) |
32,596.54 |-579.46
-1.75% |
65.17 |-0.27
-0.42% |
31,100 | 775.00
2.56% |
68.91 |4.21
6.51% |
5.00% - 7.25% |
Weekly changes as on March 22, 2018
BSE Sensex value as on March 23, 2018
Impact 
In the last 15-18 months, some high profile fund managers of the Indian mutual fund industry switched jobs ––within the industry.
You can imagine how challenging might have been for mutual fund houses or Asset Management Companies (AMCs) to find a replacement for fund managers, although there are processes in place.
Handover becomes a challenging task when key employees leave the organisation. And losing key personnel creates a huge vacuum, albeit temporarily.
When a mutual fund houses replaces fund manager/s with an entirely new face, some who is unfamiliar with the management style and the portfolio strategy of the previous fund manager, it carries some element of risk to mutual fund scheme/s he will manage, and may potentially affect the scheme's performance.
To avoid such situations, mutual fund houses have now started adopting a safe strategy of appointing a co-fund manager for their flagship schemes.
The other reason for mutual funds appointing an additional fund manager for their flagship schemes is compliance.
As you know, the capital market regulator, Securities and Exchange Board of India (SEBI), recently issued new rules to rationalise the process of categorization of mutual fund schemes. Since then, a number of mutual fund schemes with similar investment mandates have merged or are in the process.
This investor-friendly diktat from the regulator has resulted in fund houses trim their product basket of course, to an extent; but, has also increased the burden on fund manager owing to scheme mergers.
And since flagship schemes attract Assets Under Management (AUM), mutual fund houses are appointing additional fund managers, for each such scheme.
In the recent past, five fund houses have decided to lessen the workload of the existing fund managers….
They have appointed co-managers for their flagship schemes or the ones collecting large corpus.
The mutual fund schemes that will be co-managed are:
Is it a good idea?
Well, in addition to sharing the workload, a co-fund manager can bring in fresh perspective without wandering away from the investment mandate of a mutual fund scheme.
It also reduces the dependency on a single fund manager.
And as long as too many cooks are not spoiling the broth–––in this case the overall performance of a scheme––––and are adhering the investment processes and systems followed at the fund house, two (or more) fund managers for a single scheme isn't a bad idea.
Many other fund houses may soon follow suit.
How Robo-advisors Make Investing Easy And A Lesson From Stephen Hawking
Impact
Have you met IRA or Lakshmi?
If you are wondering who they are, they are humanoids or robo-bankers that greet customers at a few selected branches of HDFC Bank and City Union Bank. These robots are driven by artificial intelligence to react to customers and understand their needs.
Artificial Intelligence has taken the world by storm and almost every industry is looking to leverage its capabilities, from self-driving cars to medical diagnostics. But, should you entrust robots to make key decisions?
Recently, the world lost one of its most proficient scientists, Professor Stephen Hawking who died at the age of 76 in the early hours of March 14. He fought a life-long battle with motor neurone disease or Lou Gehrig's disease. His legacy of discoveries, teachings, and books will live on beyond this time and space.
To read more about this story, please click here.
Why Mutual Fund Houses Are Declaring Dividends Now. Know Here…
Impact
Right from close-ended thematic schemes to open-ended equity diversified schemes; mutual fund houses are generously paying dividends to their investors these days. The count of schemes that have either paid or declared dividends since February 2, 2018 is over 200.
Any guess what’s suddenly happened to mutual funds post Budget?
The answer: The change in the tax treatment.
As you know, starting on April 1, 2018, long term gains on equity investments will be taxed at 10%.
Similarly, mutual funds will pay a 10% dividend distribution tax on the dividends declared under equity-oriented schemes.
Over the last two years, many equity-oriented schemes have generated impressive returns and are seated on huge undistributed gains. To avoid making these gains taxable, mutual funds are distributing dividends from the accumulated profits of the schemes.
Are they doing it for the benefit of the investor?
Yes, most of them are.
To read more and Personal FN's views, please click here.
Here's Why AUM Of Top Mutual Funds Declined By Rs 8,900 Crore
Impact 
India's frontline indices have fallen nearly 9% from their January highs — which were also their all-time-highs.
As a result, the Assets Under Management (AUM) of the Indian mutual fund industry have fallen from Rs 23.25 lakh crore in January 2018 to Rs 23.17 lakh crore in February 2018.
March 2018 numbers may come even lower if the market continues to descend.
As reported by the Economic Times dated March 18, 2018, top 10 mutual fund houses of the country have reported a massive decline of Rs 8,900 crore in their AUM.
Does this fall look worrisome and do you, as an investor, need to take any action with your portfolio?
To read more and Personal FN's, please click here.
FUND OF THE WEEK
Reliance Tax Saver Fund: An ELSS Fund With Above-Average Risk
Reliance Tax Saver Fund is an Equity Linked Savings Scheme (ELSS), launched by
Reliance Mutual Fund over a decade ago. The ELSS fund has a stable fund manager – Mr Ashwani Kumar, who has been managing the scheme since its inception in September 2005.
Over the years, this ELSS scheme from Reliance MF has garnered a corpus of over Rs 10,000 crore. Over the past one year itself, it has added nearly Rs 3,000 crore to its AUM. The fund's corpus, which was stagnant around Rs 4,000 crore at the beginning of 2016, began to rise steadily, crossing the Rs 8,000-crore-mark in April 2017.
Within the next six months, the fund crossed the Rs 10,000-crore-mark.
Click here to read the complete note!
And Other News...
Taking note of one of the recently passed Delhi High Court Judgments, the Insurance Regulatory and Development Authority (IRDA) has directed insurance companies not to reject health insurance claims on the grounds of ‘genetic disorder’.
Therefore, going forward insurance companies can no longer make such exclusions which are vague and indiscriminate, and would pass claims.
Tutorials…
Personal Loans - All You Want to Know
Financial Terms. Simplified.
Window Dressing:Window dressing is a strategy used by mutual fund and other portfolio managers near the year or quarter end to improve the appearance of a fund's performance before presenting it to clients or shareholders. To window dress, the fund manager sells stocks with large losses and purchases high-flying stocks near the end of the quarter. These securities are then reported as part of the fund's holdings.
(Source: Investopedia)
Quote: "The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective."‒Warren Buffett