FIXED MATURITY PLANS BEAT NRE / NRO YIELDS

 

Comparative Income Analysis of NRO, NRE V/s FMP's (Fixed Maturity Plan) 

 

Comparative Income Analysis of NRO, NRE V/s FMP's (Fixed Maturity Plan) 

 

Particulars

NRO 1 Yr.

Deposit

NRO 

Savings

NRE 1 Yr.

Deposit

NRE 

Savings

ICICI Prudential Fixed Maturity Plan - Series 52

Kotak FMP 370 Days Series 7

 


DWS Fixed Term Fund - Series 74 (DFTF -74)
 


SBI Debt Fund Series 370 Days
 

Return (p.a.)

6.50%

4.00%

2.75%

3.50%

8.00% (Approx.)

8.00% (Approx.)

7.50% (Approx.)

7.50% (Approx.)

Tax rate *

33.66%

33.66%

NIL

NIL

10.30%

10.30%

10.30%

10.30%

Net

4.31%

2.65%

2.75%

3.50%

7.18%

7.18%

6.73%

6.73%

Tenure

1 Yr.

Min. 1 mnth.

1 Yr.

Min. 1 mnth.

1Year + 6days

1Year + 5days

1Year + 5days

1Year + 5days

Lock in period and Liquidity

1 yr.

Min. 1 mnth for Interest

 1 Yr.

Min. 1 mnth for Interest

 

^Redemption before maturity

 

^Redemption before maturity

 

^Redemption before maturity

 

^Redemption before maturity

Repatriation

Not
Repatriable

Not
Repatriable

Repatriable

Repatriable

Repatriable

Repatriable

Repatriable

Repatriable

Tax status

Interest/Dividend

Taxable

Taxable

TAX FREE

TAX FREE

Subject to Max. 10% Tax

Subject to Max. 10% Tax

Subject to Max. 10% Tax

Subject to Max. 10% Tax

 

 

 

Salient Features of Fixed Maturity Plan

1 Initial investment is made in Indian Rupee  Fixed Maturity Plan of  leading Mutual Funds like ICICI  Mutual  Fund, Kotak Mutual Fund, SBI  Mutual  Fund , DWS  Mutual Fund and others.

02 The principal amount and fixed returns are both guaranteed.

03 The gains are  taxed after indexation.

04 Annualized yield for NRI investor after tax ranges to 6 % to 7 %.

05 The Principal amount as also gains are fully repatriable.

 

To initiate Mutual Fund Investment & avail our Mutual Fund Portfolio Services, please provide

NAME

E-MAIL

 

 

Example For Computation Of  Indexation Benefit

 

 

 

 

Dividend

Growth

Indexation

Individual & HUF

Corporate

A

Purchase Price

100

100

100

100

B

Post Expenses Yield

9.00%

9.00%

9.00%

9.00%

C

Repurchase Price A=P*(1+R)^T

110.29

110.29

110.29

110.29

D

GAIN=C-A

10.29

10.29

10.29

10.29

E

INDEXED COST @5%

NA

NA

NA

105.00

F

INDEXED GAIN=C-E

NA

NA

NA

5.29

G

Tax Rate

14.16%

22.66%

11.33%

22.66%

H

Tax

1.28

1.90

1.17

1.20

I

Post Tax Gains

9.01

8.39

9.12

9.09

J

Value of Investment

109.01

108.39

109.12

109.09

K

Post Tax CAGR

8.76%

8.15%

8.87%

8.84%

Fixed Maturity Plans (FMPs)-  BASICS

Safe, predictable and better post-tax returns than bank FDs Rising interest rates not only mean rising EMIs but also offer an opportunity to earn higher returns. Debt schemes are now offering attractive returns with short-term rates in the region of 8-10%. Call money rates have been moving higher to about 7.5-8% due to tight liquidity conditions. With the RBI deciding to raise the cash reserve ratio (CRR), liquidity conditions have worsened. Tightness in the money markets is expected to continue till the end of the current financial year and investors can consider investing in short term options like FMPs or floating rate schemes. Fixed maturity plans, or FMPs as they are popularly called, are close-ended funds with a fixed tenure and invest in a portfolio of debt products whose maturity coincides with the maturity of the product. The primary objective of a FMP is to generate income while protecting the capital by investing in a portfolio of debt and money market securities. The tenure can be of different maturities, ranging from one month to five years. FMPs can be compared to fixed deposits of a bank. While a fixed deposit offers a 'guaranteed' return, returns in FMPs are only 'indicative'. Typically, the fund house fixes a 'target amount' for a scheme, which it ties up informally with borrowers before the scheme opens. That way it knows the interest rate it will earn on its investments, providing the 'indicative return' to investors.                                                                                                                                                                         

Benefits of FMPs

FMPs offer many benefits like tax efficiency, fixed tenure and low sensitivity to interest rates. The minimum investment amount is usually Rs 5,000, which a retail investor can easily invest.

Capital protection: FMPs have less risk of capital loss than equity funds due to their investment in debt and money market instruments.

Low interest rate sensitivity: As the securities are held till maturity, FMPs are not affected by interest rate volatility. The actual returns are more or less close to the indicative returns declared at the scheme's launch.

Lower cost: FMPs involve minimum expenditure on fund management, as there is no requirement for a time-to-time review by fund managers to buy/sell the instruments constituting the fund. Since these instruments are held till maturity, there is a cost saving in respect of buying and selling of instruments.

Tax benefits: FMPs score over fixed deposits because of their tax efficiencies both in the short-term as well in the long-term.

 

For investment in Indian Mutual Fund, please note that you require;
.01 Permanent Account Number (PAN Card) - not only PAN Number
.02 Non-Resident External (NRE) or Non-Resident Ordinary (NRO) bank account in India** and
.03 Know Your Customer (KYC) compliance.

 

** If you wish to open new NRE / NRO bank account, please inform.

 

However, if you do not have the Permanent Account Number  (PAN) and Know Your Customer (KYC) compliance which is mandatory and if you wish to avail, we will provide professional assistance for application of Permanent Account Number  (PAN) and Know Your Customer (KYC) compliance.

   

http://www.nrimutualfunds.com/application/pan_blank/pan.htm

 

http://www.nrimutualfunds.com/application/k_y_c/kyc.htm 

 

welcome to  -  INDIA   - the global investment destination  -
Indian Equity Mutual Funds with Midas Touch

● Our Objective

:

Wealth creation and value addition to client's investments.

● Our Philosophy

:
creation of portfolios optimising by way of  -  minimum risks and maximum returns. 

● Our Team 

:

Qualified chartered accountants and mutual fund advisors.

● Our Style

:

Simplicity of personalised professional services as reflected in our strategies of  :

●  NO open ended  NFOs  as our research shows initial 3 to 6 months of  investment NFOs languish.

●  NO CHURNING nor profit bookings with every swing of the stock- market.

●  Expertise of FEMA , TAX & MF Planning & portfolio Services from qualified professionals under one umbrella.

●  And ofcourse the real advantage - nrimutualfunds.com  is - being  Independent Financial Advisors [ IFA ] senior executives are constantly available to you, not playing musical chairs - an attrition menace of the Industry. 

● Our Services

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As AMFI registered Corporate Mutual Fund Advisors, our services comprise of  : 

●  Suggesting investment strategy balancing risks and returns suitably for each investor.

●  Provide detailed Asset Allocation Plan [ AAP ] and opting for purchase averaging.

●  Preparation of all necessary applications and other paper work being  dispatched to investor for signatures

●  Maintenance and reporting of portfolio on quarterly basis.

●  Advising profit booking and/or switch from time to time & further reinvestment of sale proceeds on an ongoing basis.

●  Advising tax matters and providing annual statement of Dividend and Gains.

● Your Security

    & 

    Convenience

:

 

:

All investments are made in name of the investor- under his own signature & as MF schemes are electronically linked to investor's notified bank account, error free transfers for investment & realization are ensured.

The investor has only to sign the dotted line as completed application forms and necessary paper work is prepared and dispatched by our Office.  

● Our Fees

:

Securities & Exchange  Board of India [SEBI] has abolished 2.25% Entry Load and requires MF Advisor to charge fees since August 2009 .  We offer two options of MF advisory fees for the investor to choose from.    

1.  1.25% for purchase and / or reinvestment in equity schemes.      

OR 

2.  7.5% of the profits (actual and notional) as on 31st March every year.

The fees will be payable only at the end of financial year being 31st March every year.

 

MF Equity Schemes & BSE, NSE, FTSE, Dow  1 / 2 / 3 Years Performance as on 31.07.2010

Rank

1 year - Gain

Gain %

2 years - Gain

Gain %

3 years - Gain

Gain %

Fund Name

Fund Name

Fund Name

1

DSP BlackRock Micro Cap Fund 

85.46%

Kotak Psu Bank Etf

103.17%

Franklin PHARMA FUND 

100.17%

2

Franklin PHARMA FUND 

70.15%

Franklin PHARMA FUND 

101.63%

Reliance Banking Fund

99.63%

3

DSP BlackRock Small and Mid Cap Fund 

55.54%

IDFC Small & Midcap Equity (SME) Fund 

101.58%

IDFC Premier Equity Fund 

88.31%

4

Reliance Equity Opportunities Fund 

55.46%

Reliance Banking Fund

99.34%

ING Dividend Yield Fund 

78.13%

5

ING Dividend Yield Fund 

52.25%

Birla Sun Life Dividend Yield Plus

90.82%

Franklin FMCG FUND 

77.79%

6

Birla Long Term Advantage Fund - Series 1

51.52%

ICICI Prudential Discovery Fund

90.45%

Reliance  Diversified Power Sector Fund 

77.05%

7

IDFC Small & Midcap Equity (SME) Fund

50.82%

Bsl Pure Value Fund 

87.38%

Birla Sun Life Dividend Yield Plus 

76.19%

8

Reliance Banking Fund

50.57%

Birla Sun Life MNC Fund 

83.68%

ICICI Prudential Discovery Fund

69.71%

9

Hdfc Mid-cap Opportunities Fund

50.16%

DSP BlackRock Micro Cap Fund 

80.68%

HDFC Top 200 Fund

62.19%

10

ICICI Prudential Discovery Fund

49.87%

Franklin FMCG FUND 

76.92%

DSP BlackRock Micro Cap Fund 

60.74%

11

Hsbc - Small Cap Fund 

48.85%

ING Dividend Yield Fund 

75.10%

HDFC Equity Fund 

58.51%

12

Birla Sun Life MNC Fund 

48.80%

DSP BlackRock Small and Mid Cap Fund 

74.98%

Birla Sun Life MNC Fund

57.37%

13

Canara Robeco Emerging Equities Auto Repurchase 

48.80%

Reliance Equity Opportunities Fund 

74.83%

DSP BlackRock Equity Fund 

55.20%

14

Canara Robeco Emerging Equities Growth Fund

48.80%

HDFC Equity Fund

73.25%

DSP BlackRock Small and Mid Cap Fund 

52.68%

15

IDFC Premier Equity Fund 

48.69%

IDFC Premier Equity Fund 

72.10%

Fortis Dividend Yield Fund 

51.12%

16

ICICI Prudential Technology Fund

47.76%

JM Mid Cap Fund

71.76%

BARODA PIONEER GROWTH FUND 

50.50%

17

ICICI Prudential Emerging STAR 

47.67%

Hdfc Mid-cap Opportunities Fund 

68.54%

Reliance Equity Opportunities Fund 

49.84%

18

Kotak Psu Bank Etf

46.79%

HDFC Core and Satellite Fund 

66.98%

Reliance Growth Fund 

49.53%

19

Kotak MID-CAP 

46.78%

Birla Sun Life Buy India Fund 

65.60%

Fidelity Tax Advantage Fund 

47.55%

20

Bsl Pure Value Fund 

45.40%

Fortis Dividend Yield Fund

65.46%

Birla Sun Life Buy India Fund 

47.33%

21 NSE  15.77% BSE  32.74% NSE  18.52%
22 BSE 14.03% NSE 23.88% BSE 14.90%
23 DOW JONES 12.37% FTSE -2.84% FTSE -17.33%
24 FTSE 12.35% DOW JONES -8.02% DOW JONES -20.78%

 

 

To initiate Mutual Fund Investment & avail our Mutual Fund Portfolio Services, 
Pl. provide your details at : nrimf@femaonline.com 

 

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