This will help investors to focus on schemes of their choice
Retail investors are now turning their attention to mutual funds as stock markets have offered only a marginal return over a three-year period. For a time, there was confusion among investors over selection of schemes with fund houses launching schemes in enormous numbers. There are more than 1,000 schemes offered by fund houses. With different investment options available in most of the schemes such as growth, dividend, dividend reinvestment, monthly, quarterly and yearly returns, the total number of investment options available is more than 3,500.
The investors are confused over such a number of options and they find it difficult to choose schemes suitable for them.
According to R. Raja, Senior Vice-President, UTI Asset Management Company, fund houses had already started merging schemes and the consolidation would help the investors to focus on schemes of their choice without confusion.
UTI Mutual Fund, for its part, was constantly making efforts in merging and renaming some of its schemes. Even last month it announced the merger of UTI Infrastructure Advantage Fund Series I with UTI Infrastructure Fund, Mr. Raja said. In an interaction with The Hindu, Mr. Raja said most of the schemes of UTI Mutual Fund offered steady returns to investors and the fund house was managing more than a crore of retail accounts. With equities quoting at attractive levels at present, UTI Mutual Fund was witnessing good inflows into its systematic investment plans (SIPs).
This would help investors take advantage of the buying opportunity and prepare for the next bull-run to make substantial gains, he said. Mr. Raja is, however, cautious over the short-term outlook for stock markets while in the medium to long term he sees a bullish trend as he feels the growth story of India is in tact.
According to Lalit Nambiar, Vice-President, (Fund Manager & Head-Research), the unit-linked insurance plan, UTI ULIP, offered by UTI Mutual Fund, was more popular among investors as it combined insurance and investment and offered tax rebate under Section 80C up to Rs. 1 lakh. This open-ended balanced fund invests up to 40 per cent of its corpus in equity.
The fund house hopes to get more inflows in its other tax saving plans such as UTI ETSP (a diversified scheme investing in large caps for wealth creation) and UTI RBPF (an open ended-balanced fund for pension benefits). For the ULIP, the fund house has a tie-up with Life Insurance Corporation of India through a group insurance scheme.
UTI Mutual Fund, which is managing assets of more than Rs. 65,000 crore, bets on its banking sector fund, pharma and healthcare fund and the dividend yield fund.
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'I made my money by selling too soon.'
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