Overview of UTI and LIC Mutual Funds in India
Mutual Fund
Mutual Fund
M. Maria Jessica,
PG and Research Department of
Commerce,
BON SECOURS COLLEGE FOR WOMEN,
Thanjavur.
Contents
•
INSTITUTIONS INVOLVED IN MUTUAL FUND:
- UTI
- LIC
- COMMERCIAL BANKS
INSTITUTION INVOLVED IN
INSTITUTION INVOLVED IN
MUTUAL FUND
MUTUAL FUND
INTRODUCTION
•
UTI was set up in 1964 by act of parliament.
•
It commenced its operation from July 1964 with a view to encouraging
saving and investment and participation in the income, profit and gain
accruing to corporation from the acquisition, holding management and
disposal of securities.
VARIOUS SCHEMES OF UTI FOR DIFFERENT CATEGORIES
VARIOUS SCHEMES OF UTI FOR DIFFERENT CATEGORIES
OF INVESTORS
OF INVESTORS
Income
Plan
Growth
Plan
Systematic
withdrawal
Plan
Systematic
Plan
Reinvestment
Plan
Contd..
•
Income Plan :
Income Plan :
The mutual funds distribute a substantial part of the surplus
The mutual funds distribute a substantial part of the surplus
to investors in the dividends. Example: UTI Gilt Fund.
to investors in the dividends. Example: UTI Gilt Fund.
•
Growth Plan :
Growth Plan :
An investors realize only capital appreciation on the
An investors realize only capital appreciation on the
investment and normally does not get any income in the form of income
investment and normally does not get any income in the form of income
distribution.
distribution.
•
Investment Plan :
Investment Plan :
Here, the accrued income is reinvested in the purchase of
Here, the accrued income is reinvested in the purchase of
additional units.
additional units.
•
Systematic investment plan:
Systematic investment plan:
The investor is given the option of managing
The investor is given the option of managing
investment on a periodical basis and thus inculcating a regular saving
investment on a periodical basis and thus inculcating a regular saving
habit. He may issue pre – determined date and among from the fund.
habit. He may issue pre – determined date and among from the fund.
•
Insurance plan:
Insurance plan:
Here, the investors are given an insurance cover against
Here, the investors are given an insurance cover against
life or personal accident . Example : Unit Linked Insurance Plan (ULIP)
life or personal accident . Example : Unit Linked Insurance Plan (ULIP)
LIC Mutual fund
•
LIC Mutual Fund was established on 20th April 1989 by LIC of
India. Being an associate company of India's premier and most
trusted brand, LIC Mutual Fund is one of the well known players in
the asset management sphere.
•
With a systematic investment discipline coupled with a high
standard of financial ethics and corporate governance, LIC Mutual
Fund is emerging as a preferred Investment Manager amongst the
investor fraternity.
•
LIC Mutual Fund endeavors to create value for its investors by
adopting innovative and robust investment strategies, catering to all
segments of investors.
•
LIC Mutual Fund believes in providing delight to its customers and
partners by way of superior investment experience and unparalleled
service thereby truly bring them Khushiyaan, Zindagi Ki.
LIC MUTUAL FUND SCHEMES/ PLANS
LIC MUTUAL FUND SCHEMES/ PLANS
•
LIC MF Banking & Financial Services Fund-
LIC MF Banking & Financial Services Fund-
Regular Plan
Regular Plan
•
LIC MF Banking & PSU Debt Fund
LIC MF Banking & PSU Debt Fund
•
LIC MF Bond Fund
LIC MF Bond Fund
•
LIC MF Children’s Gift Fund
LIC MF Children’s Gift Fund
•
LIC MF Debt Hybrid Fund
LIC MF Debt Hybrid Fund
CONTD….
CONTD….
•
LIC MF Banking & PSU Debt Fund Direct Growth:
LIC MF Banking & PSU Debt Fund Direct Growth:
The investment objective of the scheme is to provide reasonable possible current
income - consistent with preservation of capital and providing liquidity - from investing in a
diversified portfolio of short-term money market and debt securities. Returns are taxed as
per your Income Tax slab, if sold before 3 years. Negligible Tax (20% with indexation
benefit) post 3 years.
•
LIC MF Bond Fund:
LIC MF Bond Fund:
The fund aims to generate reasonable returns for its Investors through
Investment primarily in fixed Income securities.Returns are taxed as per your
Income Tax slab, if sold before 3 years. Negligible Tax (20% with indexation
benefit) post 3 years.
CONTD…
CONTD…
•
LIC MF Children’s Gift Fund :
LIC MF Children’s Gift Fund :
The LIC MF Children's Gift Fund Direct Growth is rated Moderately High
risk. Minimum SIP Investment is set to 1000. Minimum Lump sum Investment is 500.
To generate long term capital appreciation through a judicious mix of quality debt and
equity instruments at relatively low risk levels. If average equity holding is >65%,
returns are taxed at 15% (redeemed before one year) and 10% (After 1 year as per
LTCG). If average equity holding is <65%, returns are taxed as per your Income Tax
slab (redeemed before 3 years) and 20% with indexation benefit (post 3 years).
COMMERCIAL BANKS AND MUTUAL FUNDS
CONTD…
CONTD…
•
In the Indian economy, the eighties witnessed the operation of
both the process of intermediation and disintermediation. The
disintermediation process can be easily harnessed by
commercial banks through mutual funds. The process of
disintermediation of time deposits into mutual funds would
benefit the capital market because it would provide a
sustainable domestic source of demand.
•
Investor servicing can be effectively done by banks through
their network of branches spread throughout the country.
Hence, the commercial banks have entered into the mutual
fund market without any hesitancy.
UTI (Unit Trust of India) and LIC (Life Insurance Corporation) are prominent players in the mutual fund industry in India. UTI was established in 1964 with a focus on savings and investment, offering various schemes like Income Plan, Growth Plan, and more. LIC Mutual Fund, founded in 1989, is known for its financial ethics and governance, providing a range of investment options. Both institutions aim to create value for investors and offer innovative strategies for all types of investors, backed by a commitment to customer satisfaction.
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Presentation Transcript
Mutual Fund M. Maria Jessica, PG and Research Department of Commerce, BON SECOURS COLLEGE FOR WOMEN, Thanjavur.
Contents INSTITUTIONS INVOLVED IN MUTUAL FUND: - UTI - LIC - COMMERCIAL BANKS
INSTITUTION INVOLVED IN MUTUAL FUND
INTRODUCTION UTI was set up in 1964 by act of parliament. It commenced its operation from July 1964 with a view to encouraging saving and investment and participation in the income, profit and gain accruing to corporation from the acquisition, holding management and disposal of securities.
VARIOUS SCHEMES OF UTI FOR DIFFERENT CATEGORIES OF INVESTORS Income Plan Growth Plan Insurance Plan Systematic withdrawal Plan Reinvestment Plan Systematic Plan
Contd.. Income Plan : The mutual funds distribute a substantial part of the surplus to investors in the dividends. Example: UTI Gilt Fund. Growth Plan : An investors realize only capital appreciation on the investment and normally does not get any income in the form of income distribution. Investment Plan : Here, the accrued income is reinvested in the purchase of additional units. Systematic investment plan: The investor is given the option of managing investment on a periodical basis and thus inculcating a regular saving habit. He may issue pre determined date and among from the fund. Insurance plan: Here, the investors are given an insurance cover against life or personal accident . Example : Unit Linked Insurance Plan (ULIP)
LIC Mutual fund LIC Mutual Fund was established on 20th April 1989 by LIC of India. Being an associate company of India's premier and most trusted brand, LIC Mutual Fund is one of the well known players in the asset management sphere. With a systematic investment discipline coupled with a high standard of financial ethics and corporate governance, LIC Mutual Fund is emerging as a preferred Investment Manager amongst the investor fraternity. LIC Mutual Fund endeavors to create value for its investors by adopting innovative and robust investment strategies, catering to all segments of investors. LIC Mutual Fund believes in providing delight to its customers and partners by way of superior investment experience and unparalleled service thereby truly bring them Khushiyaan, Zindagi Ki.
LIC MUTUAL FUND SCHEMES/ PLANS LIC MF Banking & Financial Services Fund- Regular Plan LIC MF Banking & PSU Debt Fund LIC MF Bond Fund LIC MF Children s Gift Fund LIC MF Debt Hybrid Fund
CONTD. LIC MF Banking & PSU Debt Fund Direct Growth: The investment objective of the scheme is to provide reasonable possible current income - consistent with preservation of capital and providing liquidity - from investing in a diversified portfolio of short-term money market and debt securities. Returns are taxed as per your Income Tax slab, if sold before 3 years. Negligible Tax (20% with indexation benefit) post 3 years. LIC MF Bond Fund: Investment primarily in fixed Income securities.Returns are taxed as per your Income Tax slab, if sold before 3 years. Negligible Tax (20% with indexation benefit) post 3 years. The fund aims to generate reasonable returns for its Investors through
CONTD LIC MF Children s Gift Fund : The LIC MF Children's Gift Fund Direct Growth is rated Moderately High risk. Minimum SIP Investment is set to 1000. Minimum Lump sum Investment is 500. To generate long term capital appreciation through a judicious mix of quality debt and equity instruments at relatively low risk levels. If average equity holding is >65%, returns are taxed at 15% (redeemed before one year) and 10% (After 1 year as per LTCG). If average equity holding is <65%, returns are taxed as per your Income Tax slab (redeemed before 3 years) and 20% with indexation benefit (post 3 years).
COMMERCIAL BANKS AND MUTUAL FUNDS Banks can provide a wider range of products / services in mutual funds by introducing innovative schemes and extend their professionalism to the mutual funds industry. Banks , as merchant banks, have wide experience in the capital market and hence managing a mutual fund may not be a big problem for them. The entry of banks would provide much needed competition in the mutual industry which has been hitherto monopolized by the UTI. This competition will improve customer service and widen customer choice also.
CONTD In the Indian economy, the eighties witnessed the operation of both the process of intermediation and disintermediation. The disintermediation process can be easily harnessed by commercial banks through mutual funds. The process of disintermediation of time deposits into mutual funds would benefit the capital market because it would provide a sustainable domestic source of demand. Investor servicing can be effectively done by banks through their network of branches spread throughout the country. Hence, the commercial banks have entered into the mutual fund market without any hesitancy.
