Skip to main content

Structured plans in your investment portfolio

Invest In Tax Saving Mutual Funds Online

Call 0 94 8300 8300 (India)

 

WHAT'S in a name?

 

That which we call a rose by any other name would smell as sweet." That might be true for Juliet in Shakespeare's famous play but definitely not for the structured products industry, which has seen the name of structured products much tainted by the 2008 crisis.
Post 2008, structured products as an asset has been misunderstood by many investors as dangerous and highly risky.

With investor education and today's search for yield amidst highly volatile markets, structured products are increasingly being included as part of one's portfolio.


Overall in Asia, demand in the structured products industry can be likened to a deep `V', with the trough being the period right after the 2008 crisis. Since then, demand has been steadily increasing. The issuance of structured products has doubled this year, compared with 2008 and 2009, and increased 30 per cent from 2010. Trends and opportunities in structured products: As investors look to increase returns in today's low-yield environment, structured products are offering value to investors who know how to use it, in helping generate targeted returns and reducing risk exposure as part of a diversified asset allocation portfolio strategy.

The trend, however, has been moving towards the return to simplicity and a growing demand for bespoke products. We explore some of these trends below, as well as shed light on how investors can better understand and use them in their investment journey.


A growing demand for bespoke products: As investors spoke products: As investors continue to look for products tailored to their investment needs, structured products provide them with a platform to customise their exposure to a range of asset classes as the underlying to meet their expected return, risk appetite, and tenure of their investment.

 

Fixed coupon notes linked to a single or basket of equities have also been popular with investors attracted by the unconditional coupon in the mist of market uncertainty. These notes provide investors with regular income and allow them to get equity exposure for any upside potential.
The return to simplicity: With investors wary of complex structures post Lehman, there has been a demand for simplicity in the way products are structured. This explains why simple structures such as interest rated-linked callable range accrual notes with principal protection are popular with investors, especially since they provide better yields than deposit rates for cash-surplus investors who believe the underlying(s) staying at the pre-defined price range.

At the end of the day, besides offering simple structures, it is critical to ensure that investors understand the products they are investing in. For instance, even when providing yield enhancements for flat markets with simple structures (which commonly see a short-put strategy linked to a single underling such as ELNs), it is still important to adapt and explain our of ferings to meet the needs of nervous investors.

Capital protection:

As a result of uncertain market conditions, there continues to be a strong interest in capital-protected products. Investors seek products that allow them the opportunity to tap on a re bound in the underlying markets, while offering downside protection.

The mitigation of issuer risk is also key to the demand for structured products.

Seizing opportunities in the structured products space: It is important for investors to understand the movements of the underlying product and enter into these structures at the appropriate time. Having an understanding of what uying into as an underlying is, they are buying into as an underlying is, therefore, crucial in helping savvy investors to seize opportunities in these markets with the use of structured products.

Overall, we continue to see a healthy demand for structured products, especially in these volatile times when investors seek products that can help them ride a rebound and protect against the downside.

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

  1. ICICI Prudential Tax PlanInvest Online
  2. HDFC TaxSaverInvest Online
  3. DSP BlackRock Tax Saver FundInvest Online
  4. Reliance Tax Saver (ELSS) FundInvest Online
  5. Birla Sun Life Tax Relief '96 Invest Online
  6. IDFC Tax Advantage (ELSS) FundInvest Online
  7. SBI Magnum Tax Gain Scheme 1993Invest Online
  8. Sundaram Tax SaverInvest Online
  9. Edelweiss ELSS Invest Online

------------------

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online
      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online
      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online
      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online
      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver MutualFundsInvest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online
      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

Popular posts from this blog

All about "Derivatives"

What are derivatives? Derivatives are financial instruments, which as the name suggests, derive their value from another asset — called the underlying. What are the typical underlying assets? Any asset, whose price is dynamic, probably has a derivative contract today. The most popular ones being stocks, indices, precious metals, commodities, agro products, currencies, etc. Why were they invented? In an increasingly dynamic world, prices of virtually all assets keep changing, thereby exposing participants to price risks. Hence, derivatives were invented to negate these price fluctuations. For example, a wheat farmer expects to sell his crop at the current price of Rs 10/kg and make profits of Rs 2/kg. But, by the time his crop is ready, the price of wheat may have gone down to Rs 5/kg, making him sell his crop at a loss of Rs 3/kg. In order to avoid this, he may enter into a forward contract, agreeing to sell wheat at Rs 10/ kg, right at the outset. So, even if the price of wheat falls ...
Read more

ING Mutual Fund - Invest Online

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300     Information Updated As On December 30, 2013   Name of the Mutual Fund ING Mutual Fund Date of set up of Mutual Fund February 11, 1999 Name(s) of Sponsor ING Group Name of Trustee Company ING Mutual Fund Name of Trustees Mr. Chetan Mehta - Associate Trustee Mr. Haresh M Jagtiani - Independent Trustee Mr. Sunil Gulati - Independant Trustee Mr. Surinder Mohan Pathania - Independent Trustee ...
Read more

ICICI Prudential Balanced Fund

 ICICI Prudential Balanced Fund scheme seeks to generate long-term capital appreciation and current income by investing in a portfolio that is investing in equities and related securities as well as fixed income and money market securities. The approximate allocation to equity would be in the range of 60-80 per cent with a minimum of 51 per cent, and the approximate debt allocation is 40-49 per cent, with a minimum of 20 per cent. An impressive show in the last couple of years has propelled this fund from a three-star to a four-star rating. The fund has traditionally featured a high equity allocation, hovering at well over 70 per cent, which is higher than the allocations of the peers. But in the last one year, the allocation has been moderated from 78-79 per cent levels to 66-67 per cent of the portfolio. ICICI Prudential Balanced Fund appears to practise some degree of tactical allocation based on market valuations. Within equities, well over two-thirds of the allocation is parked i...
Read more

Tax Planning: Income tax and Section 80C

In order to encourage savings, the government gives tax breaks on certain financial products under Section 80C of the Income Tax Act. Investments made under such schemes are referred to as 80C investments. Under this section, you can invest a maximum of Rs l lakh and if you are in the highest tax bracket of 30%, you save a tax of Rs 30,000. The various investment options under this section include:   Provident Fund (PF) & Voluntary Provident Fund (VPF) Provident Fund is deducted directly from your salary by your employer. The deducted amount goes into a retirement account along with your employer's contribution. While employer's contribution is exempt from tax, your contribution (i.e., employee's contribution) is counted towards section 80C investments. You can also contribute additional amount through voluntary contributions (VPF). The current rate of interest is 8.5% per annum and interest earned is tax-free. Public Provident Fund (PPF) An account can be opened wi...
Read more

Fortis Mutual Fund

Fortis Mutual Fund, a relatively new player, it is still to prove its case and define its position in the industry. In September 2004, it came onto the scene with a bang - three debt schemes, one MIP and one diversified equity scheme. And investors flocked to it. Going by the standards at that time, it had a great start in terms of garnering money. Mopping up over Rs 2,000 crore in five schemes was not bad at all. The fund house has not been too successful in the equity arena, in terms of assets. Though it has seven equity schemes, it is debt and cash funds that corner the major portion of the assets. Most of the schemes are pretty new, and the two that have been around for a while have a 3-star rating each. The last two were Fortis Sustainable Development (April 2007), which received a rather poor response, and Fortis China India (October 2007). Fortis Flexi Debt has been one of the better performing funds, after a dismal performance in 2005. It currently has a 5-star rating. None ...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now