Motilal Oswal Asset Management Company Ltd. (MOAMC) is a public limited company incorporated under the Companies Act, 1956 on November 14, 2008, having its Registered Office at 10th Floor, Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai - 400025.
Motilal Oswal Asset Management Company Ltd. has been appointed as the Investment Manager to Motilal Oswal Mutual Fund by the Trustee vide Investment Management Agreement (IMA) dated May 21, 2009, executed between Motilal Oswal Trustee Company Ltd. and Motilal Oswal Asset Management Company Ltd.
Content
NAV
Motilal Oswal Dynamic Fund (Div-A) - 12.7662Motilal Oswal Dynamic Fund (Div-Q) - 11.9583Motilal Oswal Dynamic Fund (G) - 13.5717Motilal Oswal Dynamic Fund-Dir (Div-A) - 13.048Motilal Oswal Dynamic Fund-Dir (Div-Q) - 11.9481Motilal Oswal Dynamic Fund-Dir (G) - 14.2134Motilal Oswal Equity Hybrid Fund - Direct (G) - 12.2938Motilal Oswal Equity Hybrid Fund - Regular (G) - 11.8847Motilal Oswal Focused 25 Fund - Direct (D) - 18.4352Motilal Oswal Focused 25 Fund - Direct (G) - 26.8549Motilal Oswal Focused 25 Fund (D) - 16.7289Motilal Oswal Focused 25 Fund (G) - 24.2781Motilal Oswal Large and Midcap Fund - Dir (D) - 10.1291Motilal Oswal Large and Midcap Fund - Dir (G) - 10.1291Motilal Oswal Large and Midcap Fund (D) - 9.95Motilal Oswal Large and Midcap Fund (G) - 9.95Motilal Oswal Liquid Fund - Direct (Div-D) RI - 10.0077Motilal Oswal Liquid Fund - Direct (Div-F) RI - 10.0132Motilal Oswal Liquid Fund - Direct (Div-M) - 10.0521Motilal Oswal Liquid Fund - Direct (Div-Q) - 10.0253Motilal Oswal Liquid Fund - Direct (Div-W) RI - 10.0082Motilal Oswal Liquid Fund - Direct (G) - 10.8948Motilal Oswal Liquid Fund - Regular (Div-D) RI - 10.0055Motilal Oswal Liquid Fund - Regular (Div-F) RI - 10.0126Motilal Oswal Liquid Fund - Regular (Div-M) - 10.051Motilal Oswal Liquid Fund - Regular (Div-Q) - 10.0245Motilal Oswal Liquid Fund - Regular (Div-W) RI - 10.0153Motilal Oswal Liquid Fund - Regular (G) - 10.8649Motilal Oswal Long Term Equity Fund (D) - 14.9086Motilal Oswal Long Term Equity Fund (G) - 16.8254Motilal Oswal Long Term Equity Fund -Dir (D) - 16.1973Motilal Oswal Long Term Equity Fund -Dir (G) - 18.1849Motilal Oswal Midcap 30 Fund (D) - 17.5377Motilal Oswal Midcap 30 Fund (G) - 24.5493Motilal Oswal Midcap 30 Fund-Dir (D) - 18.0281Motilal Oswal Midcap 30 Fund-Dir (G) - 26.6502Motilal Oswal Multi Asset Fund - Direct (G) - 10.1484Motilal Oswal Multi Asset Fund (G) - 10.1161Motilal Oswal Multicap 35 Fund (D) - 22.8978Motilal Oswal Multicap 35 Fund (G) - 25.9904Motilal Oswal Multicap 35 Fund-Dir(D) - 22.9968Motilal Oswal Multicap 35 Fund-Dir(G) - 27.6496Motilal Oswal Nasdaq 100 FOF - Direct (G) - 18.5953Motilal Oswal Nasdaq 100 FOF - Regular (G) - 18.4552Motilal Oswal Nifty 50 Index Fund - Direct (G) - 9.7987Motilal Oswal Nifty 50 Index Fund (G) - 9.7663Motilal Oswal Nifty 500 Fund - Direct (G) - 10.9386Motilal Oswal Nifty 500 Fund (G) - 10.8592Motilal Oswal Nifty Bank Index Fund - Direct (G) - 8.8564Motilal Oswal Nifty Bank Index Fund (G) - 8.7927Motilal Oswal Nifty Midcap 150 Index Fund (G) - 11.3754Motilal Oswal Nifty Midcap 150 Index Fund-Dir (G) - 11.4584Motilal Oswal Nifty Next 50 Index Fund - Dir (G) - 9.6038Motilal Oswal Nifty Next 50 Index Fund (G) - 9.5527Motilal Oswal Nifty Smallcap 250 Index Fund (G) - 11.1281Motilal Oswal Nifty Smallcap 250 Index Fund-Dir(G) - 11.2098Motilal Oswal S&P 500 Index Fund - Direct (G) - 11.5799Motilal Oswal S&P 500 Index Fund (G) - 11.5411Motilal Oswal Ultra Short Term Fund - Dir (Div-D) - 9.7078Motilal Oswal Ultra Short Term Fund - Dir (Div-F) - 9.726Motilal Oswal Ultra Short Term Fund - Dir (Div-M) - 9.7147Motilal Oswal Ultra Short Term Fund - Dir (Div-Q) - 9.8543Motilal Oswal Ultra Short Term Fund - Dir (Div-W) - 9.7185Motilal Oswal Ultra Short Term Fund - Dir (G) - 13.7551Motilal Oswal Ultra Short Term Fund (Div-D) - 9.7113Motilal Oswal Ultra Short Term Fund (Div-F) - 9.7217Motilal Oswal Ultra Short Term Fund (Div-M) - 9.7118Motilal Oswal Ultra Short Term Fund (Div-Q) - 9.853Motilal Oswal Ultra Short Term Fund (Div-W) - 9.7147Motilal Oswal Ultra Short Term Fund (G) - 13.3756

Mutual Fund FAQ's

While the Expense Ratio of ETFs is generally low, there are certain costs that are unique to ETFs. Since ETFs, like stocks, are bought as shares through a broker, every time an investor makes a purchase, he/she pays a brokerage commission. In addition, an investor can suffer the usual costs of trading stocks, including differences in the ask-bid spread etc. Of course, traditional Mutual Fund investors are also subjected to the same trading costs indirectly, as the Fund in turn pays for these costs.
Yes. One can redeem part units also
Dividends received by the Scheme will be reinvested in the scheme. However, the Fund may also decide to distribute dividends to the investors.
Dividends received by the Scheme will be reinvested in the scheme. However, the Fund may also decide to distribute dividends to the investors.
Yes, Portfolio Management Services completely supervised by the regulator of capital markets in India, SEBI.   

An ETF is bought and sold much like a share during the trading hours in the stock exchange. Based on the purchases of new units and redemption of existing units, there is continuous creation of new units thus resulting in change of number of outstanding units Since ETFs can issue and redeem units on an ongoing basis, it keeps the market price of ETFs in line with the NAV of the Scheme.

 

Besides the fund management team, one of the important entities is the Authorized Participant (AP). They are normally referred to as market makers. An agreement is signed between the fund house and several independent APs.

 

The process flow of creation of shares as they move from the fund company through the AP, to the exchanges and ultimately, to the investors.

 

When new ETF units are created, the APs either buy or borrow the appropriate basket of shares and exchange them with the Fund for those newly created ETF units. The individual securities and cash basket turned in by the AP must be equal to the NAV published holdings from the previous close. After an ETF creation unit is issued to the AP by the custodial bank, the AP can hold the unit in a company account, trade it to another AP, or break it up into individual ETF units. Individual ETF units trade on the exchanges.

 

The reverse process occurs when redemption takes place. The AP buys ETF shares in the open market to form the correct quantity for creation of a unit. It then transfers the shares to the fund company who in turn receives securities and a cash portion to the exact NAV of the creation unit.

ETFs had started as a passive style of fund management in 1993. However over the years, lot of innovation has taken place and the regulators in markets like US have issued guidelines allowing managers to launch funds following active management of index. Products like fundamentally enhanced index are finding favors with investors.

 

ETFs are beneficial over Index Futures in many situations:

a. When investors cannot or prefer not to trade Index Futures

b. When cash flows are small and investors do not have…text not complete

c. For longer-term horizons, Index Futures need to be rolled over every month /quarter which has its own risk and costs

d. If regulations prevent investors from investing in Futures;

e.Taxation issues: With Index Futures investors can avail of only short-term capital gains while with ETFs, investors can avail long-term capital gains.

f. If the discount in ETFs is greater than the discount in futures

 

Index Futures have gained wide acceptance globally as a tradeable means of shifting exposure to Indices. Index Futures are advantageous when the implied Cost of Carry is less than the actual Cost of Carry. In addition, an investment in ETFs requires investment of the entire notional value, while an investment in Futures requires posting of an initial collateral deposit and then daily Market to Market Margins which represent a small fraction of the notional value, allowing leverage.

 

Constituents of an Index are changed as and when Securities in the Index do not match specific criteria laid down by the Index Service Provider or a better candidate is available to replace a constituent. The Index Service Provider usually makes announcements of change well in advance. Once Securities in the underlying index are changed, the Fund would change the Securities in its underlying portfolio by selling the Securities that are being removed from the Index and including those that are included in the Index. This will in no way affect the units being held by an investor, as the units will continue to track the index. The only effect may be on the tracking error of the scheme.

 

Index changes are usually not so frequent. In India, historically, around 10%of the Index constituents have changed annually which means an index of 50 securities would experience about 5 changes every year.

Same rules apply as in the case of buying or selling stocks or mutual fund units. Kindly refer the respective Scheme Information Document & Statement of Additional Information.

 

1.Asset Allocation: Asset allocation managing could be difficult for individual investors given the costs and assets required to achieve proper levels of diversification. ETFs provide investors with exposure to broad segments of the equity markets. They cover a range of style and size spectrums, enabling investors to build customized investment portfolios consistent with their financial needs, risk tolerance, and investment horizon. Both institutional and individual investors use ETFs to conveniently, efficiently, and cost effectively allocate their assets.   

2.Cash Equitisation: Investors typically seek exposure to equity markets, but often need time to make investment decisions. ETFs provide”Parking Place" for cash that is designated for equity investment. Because ETFs are liquid, investors can participate in the market while deciding where to invest the funds for the longer-term, thus avoiding potential opportunity costs. Historically, investors have relied heavily on derivatives to achieve temporary exposure. However, derivatives are not always a practical solution. The large denomination of most derivative contracts can preclude investors, both Institutional and Individual, from using them to gain market exposure. In this case and in those where derivative use may be restricted, ETFs are a practical alternative.

 3.Hedging Risks: ETFs are an excellent hedging vehicle because they can be borrowed and sold short. The smaller denominations in which ETFs trade relative to most derivative contracts provides a more accurate risk exposure match, particularly for small investment portfolios.

 4.Arbitrage (Cash Vs Futures) and Covered Option Strategies: ETFs can be used to arbitrage between Cash and Futures Market, as it is very easy to trade. ETFs can also be used for cover Option strategies on the Index.

 

A broad class of investors can use ETFs:

 

The major players in this market have historically been Large Institutional players seeking to Index core holdings or pursue more aggressive market timing and sector rotation strategies. However, since Smaller Institutions and Retail Investors can trade in small lots, they can invest in essentially the same terms as Large Investors.

 

a. For Retail or Wholesale Investors with a long-term horizon, it allows diversification of portfolio with one single investment. It insulates them from short term trading activity of other investors in the Fund as ETFs have a unique in-kind creation / redemption mechanism. Lower costs of ETFs enhance net returns in the long term.

b. For FIIs, Institutions and Mutual Funds, it allows easy Asset Allocation, Hedging and Equitising Cash at a low cost.

c. For Arbitrageurs, it provides ease with low Impact Cost to carry out arbitrage between the Cash and the Futures market.

d. For investors with a shorter term horizon, ETFs provides access to liquidity due to the ability to trade during the day and at values near to NAV.

Though Close-Ended Mutual Funds are listed on the exchange they have a limited number of shares and trade at substantial premiums or more often at discounts to the actual NAV of the scheme. Also, they lack the transparency, as one does not know the constitution and value of the underlying portfolio on a daily basis.

 

In ETFs, the numbers of units issued are not limited and can be created / redeemed throughout the day. ETFs rely on market makers and arbitrageurs to maintain liquidity so as to keep the price in line with the actual NAV.

a. Buying / Selling ETFs is as simple as buying / selling any other stock on the exchange.

b. ETFs allow investors to take benefit of intraday movements in the market, which is not possible with open-ended Funds.

c. With ETFs one pays lower management fees. As ETFs are listed on the Exchange, distribution and other operational expenses are significantly lower, making it cost effective. These savings in cost are passed on to the investor.

d. ETFs have lower tracking error due to in-kind creation and redemption.

e. Due to its unique structure, the long-term investors are insulated from short term trading in the fund.

 

ETFs derive their liquidity first from trading of the units in the Secondary Market and second through the in-kind creation / redemption process with the Fund in creation unit size.

 

Due to the unique in-kind creation / redemption process of ETFs, the liquidity of an ETF is actually the liquidity in the underlying shares.

ETFs have a very transparent portfolio holding and predefined creation basket. This allows arbitrageurs to create and redeem units every day through the in-kind creation / redemption mechanism. Such arbitrageurs are always in the market to take advantage of any significant premium or discount between the ETF market price and its NAV by doing arbitrage between the ETF and its underlying portfolio.

 

Thus, the open architecture of ETFs ensures that there is no significant premium or discount to NAV. At the same time, additional demand / supply is absorbed due to the action of the arbitrageurs.

 

ETFs can either be purchased on the Exchange or directly with the Fund. The Fund creates / redeems units only in predefined lot sizes in exchange for a predefined underlying portfolio basket. Once the underlying portfolio basket is deposited with the Fund together with a cash component, the investor is allotted the units.

 

This is in-kind creation / redemption of units, unique to ETFs.

 

Alternatively, investors can follow the "Cash Subscription" route in which they can pay cash directly to the Fund for purchasing the underlying portfolio.

a. Can easily be bought / sold like any other stock on the exchange through terminals across the country.

b. Can be bought / sold anytime during market hours at a price close to the actual NAV of the Scheme.

c. No separate form filling. Just a phone call to your broker or a click on the net.

d. Ability to put limit orders.

e. Minimum investment is one unit.

f.  Enjoy flexibility of a stock and diversification of index fund.

g. Expense Ratio is lower.

h. Provides arbitrage between Futures and Cash Market.

 

Exchange Traded Funds are essentially Index Funds that are listed and traded on exchanges like stocks. They enable investors to gain broad exposure to entire stock markets in different Countries and specific sectors with relative ease, on a real-time basis and at a lower cost than many other forms of investing.

 

An ETF is a basket of stocks that reflects the composition of an Index, like S&P CNX Nifty or BSE Sensex. The ETFs trading value is based on the net asset value of the underlying stocks that it represents. Think of it as a Mutual Fund that you can buy and sell in real-time at a price that change throughout the day.

 

An exit load is levy that an investor pays at the point of exit. This is levied to dissuade investors from exiting the fund. Assume that the current NAV of the fund is Rs.12.00 and that the exit load is Rs.0.50. Now if you sell 800 units then you stand to receive 800X11.5 = Rs. 9200.

 

The charge collected by a Mutual Fund from an investor for selling the units or investing in it.
When a charge is collected at the time of entering into the scheme it is called an Entry load or Front-end load or Sales load. The entry load percentage is added to the NAV at the time of allotment of units.
An Exit load or Back-end load or Repurchase load is a charge that is collected at the time of redeeming or for transfer between schemes (switch). The exit load percentage is deducted from the NAV at the time of redemption or transfer between schemes.

Some schemes do not charge any load and are called "No Load Schemes"

The NAVs are published in financial newspapers and also available on the AMFI website on a daily basis.
A Mutual Fund is a body corporate registered with the Securities and Exchange Board of India (SEBI), that pools up the money from individual / corporate investors and invests the same on behalf of the investors /unit holders, in equity shares, Government securities, Bonds, Call money markets etc., and distributes the profits. In other words, a mutual fund allows an investor to indirectlya take a position in a basket of assets.
Anybody with an investible surplus of as little as a few hundred rupees can invest in mutual funds. The investors buy units of a fund that best suits their investment objectives and future needs. A Mutual Fund invests the pool of money collected from the investors in a range of securities comprising equities, debt, money market instruments etc. after charging for the AMC fees. The income earned and the capital appreciation realised by the scheme, are shared by the investors in same proportion as the number of units owned by them
Securities Exchange Board of India (SEBI) is the regulatory body for all the mutual funds mentioned above. All the mutual funds must get registered with SEBI. The only exception is the UTI, since it is a corporation formed under a separate Act of Parliament.

For a retail investor who does not have the time and expertise to analyze and invest in stocks and bonds, mutual funds offer a viable investment alternative. This is because:

1. Mutual Funds provide the benefit of cheap access to expensive stocks

2. Mutual funds diversify the risk of the investor by investing in a basket of assets

3. A team of professional fund managers manages them with in-depth research inputs from investment analysts.

4. Being institutions with good bargaining power in markets, mutual funds have access to crucial corporate information which individual investors cannot access.

 

There are several benefits from investing in a Mutual Fund.


A. Small investments: Mutual funds help you to reap the benefit of returns by a portfolio spread across a wide spectrum of companies with small investments. Such a spread would not have been possible without their assistance. Professional Fund Management: Professionals having considerable expertise, experience and resources manage the pool of money collected by a mutual fund. They analyze markets and the economy to select good investment opportunities.


B. Spreading Risk: An investor with a limited amount of fund might be able to invest in only one or two stocks / bonds, thus increasing his or her risk. However, a mutual fund will spread its risk by investing in a number of sound stocks or bonds, across sectors, so the risk is diversified, along with taking advantage of the position it holds. Also in cases of liquidity crisis where stocks are sold at a distress, mutual funds have the advantage of the redemption option at the NAVs (Net Asset Values). Transparency and easy access to information: Mutual Funds regularly provide investors with information on the value of their investments. Mutual Funds also provide complete portfolio disclosure of the investments made by various schemes and also the proportion invested in each asset type and clearly layout their investment strategy to the investor.


C. Liquidity: Closed ended funds have their units listed at the stock exchange, thus they can be bought and sold at their market value. Over and above this the units can be directly redeemed to the Mutual Fund as and when they announce the repurchase.


D. Choice: The large amount of Mutual Funds offer the investor a wide variety to choose from. An investor can pick up a MF scheme depending upon his risk / return profile.


E. Regulations: All the mutual funds are registered with SEBI and they function within the provisions of strict regulation designed to protect the interests of the investor

An investor can reduce his total risk by holding a portfolio of assets instead of only one asset. This is because by holding all your money in just one asset, the entire fortunes of your portfolio depend on this one asset. By creating a portfolio of a variety of assets, this risk is substantially reduced

No. Mutual fund investments are not totally risk free. In fact, investing in mutual funds contains the same risk as investing in the markets, the only difference being that due to professional management of funds the controllable risks are substantially reduced.

 

A very important risk involved in mutual fund investments is the market risk. When the market is in doldrums, most of the equity funds will also experience a downturn. However, the company specific risks are largely eliminated due to professional fund management.

 

On the basis of Objective

A. Equity Funds/ Growth Funds
Funds that invest in equity shares are called equity funds. They carry the principal objective of capital appreciation of the investment over the medium to long-term. The returns in such funds are volatile since they are directly linked to the stock markets. They are best suited for investors who are seeking capital appreciation. There are different types of equity funds such as Diversified funds, Sector specific funds and Index based funds.


B. Diversified funds 
These funds invest in companies spread across sectors. These funds are generally meant for risk-taking investors who are not bullish about any particular sector.


C. Sector funds 
These funds invest primarily in equity shares of companies in a particular business sector or industry. These funds are targeted at investors who are extremely bullish about a particular sector.


D. Index funds 
These funds invest in the same pattern as popular market indices like S&P 500 and BSE Index. The value of the index fund varies in proportion to the benchmark index.


E. Tax Saving Funds
These funds offer tax benefits to investors under the Income Tax Act. Opportunities provided under this scheme are in the form of tax rebates U/s 88 as well saving in Capital Gains U/s 54EA and 54EB. They are best suited for investors seeking tax concessions.


F. Debt / Income Funds
These Funds invest predominantly in high-rated fixed-income-bearing instruments like bonds, debentures, government securities, commercial paper and other money market instruments. They are best suited for the medium to long-term investors who are averse to risk and seek capital preservation. They provide regular income and safety to the investor.


G. Liquid Funds / Money Market Funds 
These funds invest in highly liquid money market instruments. The period of investment could be as short as a day. They provide easy liquidity. They have emerged as an alternative for savings and short-term fixed deposit accounts with comparatively higher returns. These funds are ideal for Corporates, institutional investors and business houses who invest their funds for very short periods.


H. Gilt Funds
These funds invest in Central and State Government securities. Since they are Government backed bonds they give a secured return and also ensure safety of the principal amount. They are best suited for the medium to long-term investors who are averse to risk.


I. Balanced Funds 
These funds invest both in equity shares and fixed-income-bearing instruments (debt) in some proportion. They provide a steady return and reduce the volatility of the fund while providing some upside for capital appreciation. They are ideal for medium- to long-term investors willing to take moderate risks.

In an open-ended mutual fund there are no limits on the total size of the corpus. Investors are permitted to enter and exit the open-ended mutual fund at any point of time at a price that is linked to the net asset value (NAV). In case of closed-ended funds, the total size of the corpus is limited by the size of the initial offer.
A systematic investment plan is one where an investor contributes a fixed amount every month and at the prevailing NAV the units are credited to his account. Today many funds are offering this facility.

A systematic investment plan (SIP) offers 2 major benefits to an investor:

    • It avoids lump sum investment at one point of time
    • In a scenario of falling prices, it reduces your overall cost of acquisition by  a process of rupee-cost averaging. This means that at lower prices you end up getting more units for the same investment

 

NAV is the net asset value of the fund. Simply put it reflects what the unit held by an investor is worth at current market prices.
Investors need to be clear that mutual funds are essentially medium to long term investments. Hence, short-term abnormal profits will not be sustainable in the long run. But in the medium to long run the mutual funds tend to outperform most other avenues of investments at the same time avoiding the risk of direct investment accompanied with professional fund management.

Mutual Funds give returns in two ways - Capital Appreciation or Dividend Distribution.

A. Capital Appreciation : An increase in the value of the units of the fund is known as capital appreciation. As the value of individual securities in the fund increases, the fund`s unit price increases. An investor can book a profit by selling the units at prices higher than the price at which he bought the units.

B. Dividend Distribution: The profit earned by the fund is distributed among unit holders in the form of dividends. Dividend distribution again is of two types. It can either be re-invested in the fund or can be on paid to the investor.


Site best viewed in IE 9.0+, Mozila Firefox 4.0+ and Google Chrome at 1024 x 768 pixels resolution
KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (broker, DP, Mutual Fund etc), you need not undergo the same process again when you approach another intermediary