The Hindu Business Line : Update

The Securities and Exchange Board of India has approved the removal of initial issue expenses for close-ended mutual fund to reduce the cost to the investors.

Currently, initial issue expenses on close-ended funds are amortised over the period of the fund. The current SEBI rules allow new fund offers to charge up to 6 per cent of the initial mobilisation and the new fund offer expenses charged to the schemes are amortised over a period of three years.

Principal Mutual Fund has revised the exit load structure under Principal MIP and Principal MIP Plus Fund. With effect from February 1, both these funds will charge an exit load of 1 per cent for investment less than Rs 1 crore, if redeemed within six months, and 0.25 per cent for investments equal to or greater than Rs 1 crore but less than Rs 3 crore, if redeemed within 90 days.

DSPML Mutual Fund has signed a distribution agreement with Oriental Bank of Commerce to distribute its investment products, especially mutual funds, through the latter’s branch network.

Standard Chartered Mutual Fund launched the Small and Midcap Equity Fund, a close-ended equity fund that predominantly invests in small and mid-cap equity and related instruments included in the CNX Midcap index, or equity and related instruments of such companies that have market capitalisation lower than the highest components of CNX Midcap.

Asset allocation: The fund will invest 65-100 per cent in equity-related instruments included in the CNX Midcap and 0-35 per cent in debt and money markets instruments. It is a close-ended scheme with automatic conversion into an open-ended fund on the completion of 36 months.

The fund will charge no entry load and there will be no exit load either. However in case an investor exits the scheme before the amortisation is complete, the AMC shall redeem the units after recovering the balance proportionate unamortised issue expenses.

The fund closes for subscription on February 15.

More Stories on : Mutual Funds | New Fund Offer

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page