Aditya Birla Sun Life Mutual Fund has launched Turbo Systematic Transfer Plan (STP) which enables unitholders to transfer variable amounts from a source scheme to a target scheme at defined intervals.
Turbo STP helps investors more when market valuation is attractive and less when market valuation turns expensive to optimise the investment growth potential.
The facility will be available in weekly, monthly and quarterly intervals.
In-house model
The variable or actual amount of transfer to the target scheme will be determined based on the results from an in-house model which helps ascertain market valuation. The model tracks technical and fundamental parameters such as valuation ratios, trend ratios and volatility ratios, to arrive at an Equity Valuation Multiplier (EVM).
This value helps determine the actual amount to be transferred based on the pre-selected STP base amount.
A Balasubramanian, Managing Director, Aditya Birla Sun Life AMC said, Turbo STP is suited for participants with lumpsum amount to invest and are confronted with issues regarding market valuations. It will help invest more at attractive market valuation levels and less when valuations are expensive, he said.
If the base installment amount is ₹10,000 and multiplier range – 0.2 to 5 times. If latest EVM is 0.72, the matrix defines transfer of 0.2 times of base instalment amount ₹2,000 will be transferred to target scheme from source scheme.
If latest EVM is 1.31, the matrix defines transfer of 3.66 times of base instalment or ₹36,600 to target scheme from source scheme.