Mid cap and small cap stocks have been rallying since the beginning of 2020. In the last 15 days, mid cap and small cap indices have gained between 3-5%, as soaring valuations in large cap stocks along with ample liquidity started chasing quality stocks in these segments. Riding on the wave, even the mid cap and small cap mutual funds, which were beaten down badly in the last two years, started inching up once again in the last few months. The small cap mutual fund category has returned 7.78% in one month and 4.40% in one week. Similarly, the mid cap mutual fund category has offered 5.00% in one month and 3.83% in one week. Is the revival finally here? In other words, is it time to invest in these schemes? “After the budget, we are expecting a mid cap rally. The recent uptick in the small and mid cap indices is because of the liquidity moving to these segments from the large caps. A narrow-based rally in the large cap segment has left out most of the large cap stocks, so the … [Read more...] about Mid-, small-cap mutual funds have started rallying. Is it time to invest?
Debt schemes of Franklin India Mutual Fund are in the news due to their exposure in the troubled Vodafone-Idea papers. Some of the debt schemes of the AMC are also giving negative returns in the last one year. What should investors do? The NAVs of Franklin’s debt schemes took a huge hit in a single day as on 16 th January. Franklin India Low Duration Fund fell by around 7%. Franklin India Income Opportunities fell by 5%, Franklin India Credit Risk Fund fell by 5%, Franklin India Short Term Income Plan fell by 4.5%, Franklin India Ultra Short Bond Fund came down by 4.4% and Franklin India Dynamic Accrual Fund fell by 4.3%. One year returns of these schemes are -2% for Franklin India Low Duration Fund, 0.05% for Franklin India Income Opportunities, -1.03% for Franklin India Credit Risk Fund, -0.45% for Franklin India Short Term Income Plan, 4.65% for Franklin India Ultra Short Bond Fund and 1.80% for Franklin India Dynamic Accrual Fund. Most debt investors we’re betting … [Read more...] about Should you worry about your investments in Franklin Templeton debt mutual fund schemes?
NEW DELHI: Franklin Templeton Mutual Fund marked down its debt exposure to Vodafone Idea papers to zero concerned by huge statutory debts that the telecom major has to pay within a week. The asset manager’s decision hits the NAV of six funds run by it — Low Duration Fund, Dynamic Accrual Fund, Credit Risk Fund, Short Term Income Plan, Ultra Short Bond Fund and Income Opportunities Fund. Their NAV has come down between 4-7 per cent after the move. “The large quantum of AGR dues and the immediate payment timeline is resulting in significant uncertainty with respect to our exposure to Vodafone Idea… while relief avenues do exist, the situation remains unclear,” said the mutual fund house. Franklin Templeton has also put upper bounds on the investment in these funds at Rs 2 lakh per day per fund per investor. “A limit on purchases will help ensure that once clarity emerges and as resolution takes place, the interest of existing unitholders has not … [Read more...] about Franklin Templeton MF marks down Vodafone Idea exposure; these 6 funds take a hit
When Ajoy Ghosh opened an National Pension System (NPS) account last month, his basic objective was to save tax. Ghosh has opted for the NPS benefit offered by his company, under which Rs 5,200 is put in the scheme on his behalf every month. He has invested an additional Rs 50,000 under Section 80CCD(1b) of the Income-tax Act, 1961. The total investment of Rs 1.12 lakh in the scheme will reduce his annual tax by Rs 35,000. “I have exhausted all other tax-saving avenues. The only way I can save tax is by investing in NPS,” says the Kolkata based telecom engineer. In many ways, investors like Ghosh miss the wood for the trees. They are so focused on saving tax that they don’t consider other aspects of the investment. Ghosh did not assess the pension fund he has invested in. Nor did he consider the asset mix he should opt for. “I just went with what the investment adviser from the bank told me,” he says. NPS helps save tax in 3 ways: Sec 80CCE: Rs 1.5 … [Read more...] about Best performing NPS funds for different asset allocations at the start of FY 2018-19
As the Budget is around the corner, reports suggest that the dividend distribution tax could be abolished. The task force on the direct tax code has also recommended scrapping dividend distribution tax (DDT) in order to boost investments. What is DDT?A dividend is a sum of money given by a company to its shareholders out of the profits earned. Dividend distribution tax is the tax levied on the dividend paid by a company to its shareholders. The provisions of DDT were introduced by the Finance Act 1997. Only a domestic company is liable and has to pay the tax even if it is not liable to pay any tax on its income. How does its abolition help the economy?After the government announced a cut in corporate tax rate, there were many who called for removal of Dividend Distribution Tax (DDT). If the government abolishes the DDT, it will boost market sentiment and allow companies to invest more in the economy. The move will make the Indian equities more attractive for foreign investors and … [Read more...] about What is Dividend Distribution Tax & how will its abolition impact the economy?