MF Statement

When you start investing in Mutual Funds ( MFs) you are suppose to receive a Mutual Fund statement every quarter , especially , if you are investing through SIP.

Watch out for these details on your MF statement

Scheme Name and Option :
Make sure your money is being invested in the correct Mutual Fund scheme of your choice and also make sure the Option of the scheme which could be Growth, Dividend - Payout , Dividend - Reinvest , is as per your choice

Name and Address :
Make sure your Name is spelt right and also check your contact address ( Postal Address in case you received the statement by Email and Email address, in case you are getting your statement by Post ).

Email  Address and Mobile Number:
Make sure your email address is proper as, then you can get a statement from CamsOnline.com ,anytime you like using your registered email Id. Check you mobile number too , so that you can be sent SMS alerts by the MF when your SIP is due and when a purchase has been made

KYC Status :
Make sure your KYC status is OK/Validated on your statement .if your are not KYC compliant , you will not be allowed to make any new investments nor will you be allowed to sell your current holdings

Bank Details :
Make sure proper Bank Account details are mentioned , along with the IFSC code ,
If IFSC code is mentioned then MF can directly credit the dividends as well as redemption money into your bank account saving you time and effort of depositing cheques into your bank account and also avoid getting into the agony of losing/misplacing cheques.

SIP Amount/Lumpsum Amount:
Make sure the amount that has been invested is correct .

Broker Details:
If you were helped by a broker to invest , you would then see the Broker's name here, else you are suppose to see "Direct". This must not affect your investment directly , but brokers are usually paid a trail commission by the Mutual Funds , which is paid from charges deducted from you . So, in case you have invested directly/Online without any broker's help make sure it is "Direct"

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FMP Fever

MF funds are back with a flood of Fixed Maturity Plan (FMP) . What really are FMPs , as i understand ,they are closes ended plans ( that is ,you can only buy them when , AMC opens the subsciption , and can either hold it till maturity or may be sell it on the stock market , where it will be listed ) , which invests in rated corporate bonds and and other such instruments , which ideally have term equal to the term of the FMP .

Currently MFs are coming up with FMPs of duration of as low as 35 days, 3Months to 370 days to may be 36 Months.

With the current interest rate scenario , which has a upward bias , it is not a good idea to lock into a instrument with a longish term and FMP may just fit right for this scenario.

With too many MFs comming out with FMP issue , it would be quite a pain to track , which offer is open for subscription , I usually use http://www.mutualfundsindia.com/ to track FMP NPOs.

HDFC,DSP Blackrock and many other provide you a way to buy these online without any hassel ,but for some reason Fidelity MF had some problems after their first couple of FMP subscription online ,and since then they have taken it offline

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Keeping cost low

Once a individual has overcome the initial intertia to start investng , it would help investor to keep a eye on the cost involved . The cost could be what you pay you broker/online broking account , what your MF agent ( if there is still such a guy around ) .

One of the best way , atleast for me , regarding my MF investing has been that , i have been able to keep my trading account completely isolated from my MF holdings, thanks to more and more Asset Management Companies (AMC) going online , allowing investors to invest from their website.

The backend of most of these MFs , CAMS and Karvy , have been equally proactive to provide investor with an option to see their entire portfolios across AMCs as a single consolidated PDF file and on demand, that too free.

So if you ask me, i would say , use the AMC websites to purchase you MF units , you can even use these sites to start off your SIPs. if not, a trip to the CAMS or Karvy office with physicals forms is not a bad idea .

Bottomline, be in firm control of your folios and not be at the mercy of your online trading websites , atleast not for your MF folios.

Saving on Auto Pilot

Have been reading on Ramit Sethi's blog where he stresses on setting your Savings/Investments in a Auto Pilot mode and i started wondering how can we in India do that ..

1) Increase PF Contribution : For those of you who are employed and for whom your employer provides you with a Provident Fund , first figure out if you can increase the contibution from the current 12% to say any percentage more ( Maximum would be 25% ) . your employer will not match you , but just that you have started to contribute more money that would be compounding at 8.5% interest .

2) Mutual Fund SIP: Start a SIP of any 5 start rated Mutual fund( http://www.valueresearchonline.com/toprated.asp) , choose first of the month as date of SIP

3) Open a Recurring Deposit: You can open a recurring deposit , try to keep desposit date in the first week of the month . Now you even have a Recurring deposit , whose interest is variable .

4) Use a Online trading account: Some of the trading accounts ( Sharekhan.com does) allows you to set a SIP for stock(s) .That is to buy a certain script on a specific day of the month .May be for a start, try to buy NIFTY BEES (benchmarkfunds.com/static/Nifty/overview.cgi)

The Intent in all these is not only to automate , but also to make you "Pay Yourself First".

If you can think of any other ways of doing this , Please do comment .

Help at hand to manage your MFs

I have always found it tough to to keep track of my Mutual Fund investments not that there are too many , but the fact that i have them with different AMC http://www.amfiindia.com/ means that i would need to login into different websites to keep track.

This is where http://www.camsonline.com/ comes in handy. CAMS is a back office services provider for many of India's leading AMC and if you take care to mention your email address , when you apply for any of MFs, from the CAMS online site it is possible to get a detailed holding of all your MF(across AMC, across folios) through a single email , either as a secure attachment or as a link.I feel this an extremely useful feature.