I want to invest in Mirae Asset Emerging Bluechip Fund. But the fund imposed several restrictions, including an investment cap. Can I consider the fund or are there regulatory issues? -BSR Sastry, Hyderabad
Over the years, Mirae Asset Emerging Bluechip Fund has maintained its record of performance, consistency and reputation. The fund maintains its top position in the bluechip category.
Launched in 2010, Mirae Asset Emerging Bluechip Fund invests in a combination of large and mid-sized companies. Large-cap companies are chosen from the top 100 companies by market capitalization. Mid-cap companies are selected from the top 250 companies by market capitalization. The fund follows the bottom-up approach, focusing on value-oriented investing in growth-oriented companies.
According to SEBI’s definition, the 100 largest stocks by market cap are classified as large-cap stocks, and the next batch of the 150 largest stocks by market cap are called mid-cap stocks. Depending on the class mandate, the minimum allocation to large and mid-cap stocks in these plans is 35% each, and the maximum can be 65% each.
Mirae Asset Emerging Bluechip Fund is a good choice. However, this fund is not suitable for investors seeking quick returns or early redemption. Investors who can exercise patience and remain calm even during a stock market crash or volatile market and who have an investment term of three to five years or more – should only consider this fund. If you’re looking for inflation-beating gains, you also need to be prepared for the adversaries and the ups and downs. Like any other equity mutual fund, the Mirae Asset Emerging Bluechip Fund program does not guarantee or assure any return.
The Mirae Asset Emerging Bluechip Fund program, which emphasizes quality and growth, has reduced new investments through the Systematic Investment Plan (SIP) mode from 25,000 to 2,500. was reported. The Mirae Asset Emerging Bluechip Fund program has also been removed from lump sum investments. However, the fund house may authorize investments from several investors within the family with a different PAN.
Can I invest in mutual funds in my minor daughter’s name? – Arun R, Bangalore
Yes, minor children under the age of 18 are allowed to invest in a mutual fund in their name. SEBI has a framework with respect to investing in mutual funds on behalf of minors to enable the efficient process and transmission of MF units. The uniform process and guidelines stipulated by SEBI apply to all mutual fund asset management (AMC) companies.
In accordance with SEBI guidelines, investment in mutual funds or purchase of mutual fund units in the name of a minor may be made either from a savings bank account of a minor child, either from a joint bank account of the minor child with the guardian only, by cheque, demand draft or any other acceptable method. For existing mutual fund investment portfolios, CMAs should require a change of payment bank mandate prior to redemption processing.
When the minor reaches the age of 18, the Investment Management Company (AMC) will terminate investments (SIP) in all mutual funds. The mutuals will send a letter to the head office of the guardian and the minor informing them of this. AMCs usually ask for certain documents such as a copy of the birth certificate, the guardian’s relationship to the child, and the PAN if it is available in the child’s name. These documents only need to be provided for the first investment. When the minor attains the status of major (reaches the age of 18), the minor in whose name the investment has been made will be required to provide all KYC details and updated bank account details, including the canceled check sheet of the new account. No further transactions will be permitted until the minor’s status is changed to major. In the case of SIPs, the Portfolio Management Company will terminate the investments of the SIP once the child reaches the age of 18.
The investment in the mutual fund can be any amount without any restrictions. Either parent, grandparent, other family member, or legal guardian of a child can invest a significant amount of money in a mutual fund. However, the mutual fund portfolio will be in name only. There is no need for joint ownership of the mutual fund investment, unlike a bank account. Before doing this, the minor must convert the status of the savings bank account from minor to major. Mutual fund investments can be continued and SIPs can be resumed under the same folio once the mutual fund investment accounts are converted to “major” status.
(The author is a SEBI Accredited Research Analyst. An alumnus of the Indian Institute of Foreign Trade (IIFT), he has held senior positions at National Geographic, Reliance Radio Television Luxembourg, STAR TV, etc.)