ICICI RICH ULIP NFO Review

ICICI Prudential Life Insurance has come out with its New Fund offer of NFO in the name of ICICI R.I.C.H. Fund or ICICI RICH Fund. Interestingly, they have a disclaimer saying that RICH does not necessarily mean Rich – it’s an abbreviation. In this article, I'll attempt to present a review of ICICI RICH (R.I.C.H.) fund. It should help you decide whether you should invest in ICICI RICH (R.I.C.H.) fund or not.

RICH stands for Resources, Investments, Consumption and Human Capital. So basically, what this fund will do is that it will invest in the companies which fall in the above 4 RICH categories and hence it will try to generate capital appreciation for the investors money in the long run. Suddenly from somewhere, these 4 categories have become the most promising sectors for ICICI fund management business. Does it mean that other funds from ICICI investing in other categories are not worth investing?

Then comes the advertisement part – There is a picture of 4 cricketers taken from behind their back. From the height & hair style, they seem to resemble Dhoni, Sachin, Bhajji and Ishant. There is a name on each of the t-shirt of the cricketers – Dhoni lookalike mentions “Resources”, Sachin for “Investments”, Bhajji for “Consumption” and Ishant lookalike for “Human Capital”. Not sure about others, but does Bhajji consume too much?? : -)

Anyways, the investment scheme is to invest in stocks and stock related instruments for the following four sectors:

• Resources: Stocks and companies which belong to natural resources like Oil, petroleum, Natural Gas, Metals, etc.

• Investments: Capital goods, Infrastructure, Engineering services, etc.

• Consumption: Consumer durables, Entertainment, Media, etc.

• Human Capital: IT, Technology, Biotech, any service or research oriented company stocks and shares.
However, I’m getting the question that what have they left out? Almost every single stock sector has been covered. What are they trying to invest in in the name of RICH? Don’t they think simply buying an ETF would be better option than offering this new scheme.

Related: An example of ETF

Portfolio allocation will be 80% to 100% in stocks, shares and equity related instruments, and remaining 0% to 20% will go to Debt related, Money market instruments or cash holdings of the company.

NFO for ICICI RICH fund will open on 15th march 2008.

Each NFU Unit will cost Rs. 10 per unit.

Tax Benefit under ICICI RICH (R.I.C.H.) fund: Not Available!

No info is available about the entry load and exit load of the ICICI RICH NFO The scheme is a ULIP or Unit Linked Investment Plan and will work on the basis of NAV or Net Asset Value as the value of the underlying stocks and shares will change every business day.

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