MCX IPO Grey Market Premium Price Information & Details

In our earlier post MCX IPO: Review Analysis & Details of Multi Commodity Exchange (MCX) IPO, we had covered the basic details and review analysis of the much awaited MCX IPO - the first such IPO listing in India where a stock exchange is going to list its share for trading in Indian Stock Markets.

In this article, we will cover details of Grey Market Premium for the MCX IPO. Please note that these details are as available from the various news items through print and TV media business news channels and is not a verified or confirmed information. MCX IPO is much awaited IPO by many investors as it is one of the first stock exchanges to list its shares for trading. Usually, exchanges earn their income from the transactional fees, subscription fees, licence fee for index, etc. and considered to be safe. However, no returns are guaranteed - it all depends upon the time and randomness and investors need to keep the risks in mind. Image sourced from official MCX Exchange website
Now, coming back to the Grey Market Premium Prices for the MCX IPO:

Grey Market Premium Prices for MCX IPO

As reported by a leading business news channel, the MCX IPO has once again opened the Grey market Trading in the Indian Stock market business. Although it is not known to be legal, but this business continues. As per the news available, the MCX IPO is currently trading at a premium in the range of Rs. 270 to Rs. 320 per share.
Now this IPO premium is really high as compared to the price band of the MCX Rs. 860 to Rs. 1032. Even at the higher end of the price band of Rs. 1032, the Grey market premium of average Rs. 300 means a 30%.
Market reports say that this grey market premium will increase further as the IPO opens for subscription and listing day approaches.

What does this Grey market price premium for MCX IPO mean?
The grey market involves unofficial buying and selling of shares a few days before the actual listing of the IPO on the stock exchanges. Since this activity starts few days before the actual listing of the shares, the extra premium is considered to be profitable to the traders. However, once the stocks list, the premium gradually or rapidly disappears, as the case may be depending upon the market perception of the stock valuation.

Is the return guaranteed if an upcoming IPO is having a grey market premium like that reported for MCX IPO
NO- nothing is guaranteed. Just because some upcoming IPO is quoted to be trading at a premium in the grey market, it does not mean that it will definitely be profitable to the investors. Remember the fate of Anil Ambani's ADAG group's Reliance Power IPO: What went wrong? - that was also trading at a big premium in grey market, but things went wrong on the listing day itself. Check the above article for more details.

What is the final opinion about investing in MCX IPO?
Irrespective of whatever is going on in the so called grey market, stock exchanges investments in form of buying its listed shares is good in the long run.
As listed in detail in our review of MCX IPO article MCX IPO: Review Analysis & Details of Multi Commodity Exchange (MCX) IPO, this IPO will be a good bet for long term hold. See the above article for more details.

IDBI Dynamic Bond Fund NFO: Review Analysis & Details

Details about IDBI Dynamic Bond Fund
IDBI Mutual Fund house has come out with a Bond Fund and its NFO is currently open. In this article, we will explore this IDBI Dynamic Bond Fund and see whether this Bond fund from IDBI is any useful to investors and which class of investors does this IDBI Dynamic Bond Fund suit.
Let's begin with some basic details of IDBI Dynamic Bond Fund:

What actually is this IDBI Dynamic Bond Fund?
IDBI Dynamic Bond Fund is a fund launched by IDBI mutual fund house and like any other mutual fund this fund will also collect money from investors and invest in certain financial instruments with an aim to generate good returns.
Since this is a Bond fund, the money collected will be invested in Bonds and similar other Debt based and money market instruments. Hence, the returns from this fund will not be that volatile as like those from equity or stock based mutual funds, but this fund claims to be less risky compared to the equity mutual funds.
Traditionally, Indian investors go for stock based mutual fund, but lately debt based mutual funds are also gathering good customer interest hence this fund may find a good interest in the market.
Also, we have observed a good long period of high interest rates where returns from debt instruments have been better than equity markets. So that is what the fund managers of this IDBI Dynamic Bond Fund are trying to capitalize upon.

Being a Bond or Debt fund, are returns guaranteed from this IDBI Dynamic Bond Fund?
No, nothing is guaranteed. No bond fund or debt fund would ever (or can guarantee) any returns or capital protection and same is true for this IDBI Dynamic Bond Fund also.
Investors should not live under the impression that bond funds are risk free or come with any kind of guaranteed returns.

What are the NFO dates for IDBI Dynamic Bond Fund?
The IDBI Dynamic Bond Fund is open from 31 January 2012 to 14 February 2012 for its NFO period

IDBI Dynamic Bond Fund Review Analysis & Details

What will be the benchmark index for tracking returns of IDBI Dynamic Bond Fund?
CRISIL Composite Bond Fund Index will be used for tracking performance of IDBI Dynamic Bond Fund

What are the other investment details of IDBI Dynamic Bond Fund?

Minimum investment in IDBI Dynamic Bond Fund is Rs. 5000 and in multiples of Re. 1 thereafter.

Multiple options available for investments:
Growth Option
Dividend Option - Payout will be quarterly or annual (as per the availability)

Face value will be Rs. 10

Mr. Gautam Kaul will be the fund manager

Systematic Investment Plan (SIP) for IDBI Dynamic Bond Fund?
SIP is available for IDBI Dynamic Bond Fund:
If you go for monthly option for a minimum 12 months, then Rs. 500 minimum per month and multiples of Re. 1 above that.
For 6 months, Rs. 1000 minimum per month and multiples of Re. 1 above that.

For Quarterly Option, Rs 1500 minimum per quarter and multiples of Re. 1 above that, for minimum 4 quarters

What are the entry load and exit load charges for IDBI Dynamic Bond Fund
Entry Load NIL
Exit load NIL

Is there any tax saving or tax benefit available in IDBI Dynamic Bond Fund
No, there will be no tax saving or tax benefit

See List of All Mutual Fund and NFO Articles here

Final Thoughts about IDBI Dynamic Bond Fund
A good option for investors who are willing to look for some exposure to the debt instruments and money market securities. However, please note that the returns are not guaranteed, nor is the capital protected with any guarantee. Bond funds do come with their own set of risks (although they are less volatile compared to equity fund.
IDBI Dynamic Bond Fund

Fidelity Tax Advantage Fund: Save Tax by investing in Fidelity ELSS

This article contains details & information about Fidelity Tax Advantage Fund (Fidelity Tax Advantage Fund ELSS). Also covered is the review, analysis, details and opinion about investing in Fidelity Tax Advantage Fund
Its time the financial year is ending in India and individual tax payers, expecially the salary class, are worried about tax savings. Before the Direct Tax Code or DTC gets implemented about which there are concerns that it might take away the tax savings offered by ELSS, investors might have this last chance for getting tax benefits for investing in an Equity based mutual fund.

What actually is the Fidelity Tax Advantage Fund?
Fidelity Tax Advantage Fund is a mutual fund from the world renowned Fidelity mutual fund house. Like any other mutual fund, this fund too collects money from the common investors and invests it in equity/stocks with an aim to generate returns.
It is categorized as an ELSS or Equity Linked Saving Scheme, which gives investors a tax benefit as well.

Fidelity Tax Advantage Fund Details

What is unique about Fidelity Tax Advantage Fund?
Apart from being a equity based mutual fund, this fund also offers tax savings under the ELSS scheme under section 80(C) of Income tax act i.e. any investments made in this scheme (for the entire cap of 1 Lakh Rs. under section 80(C)) will be exempted from taxes.
See related: Complete List of Qualifying investments under section 80C and Tax Savings details for Section 80C

What are the other details about Fidelity Tax Advantage Fund
The fund has been around since 2006. Since it offers tax savings, it comes with a lock-in period of 3 years i.e. investors investing into this fund for tax saving purpose cannot withdraw their money for 3 years.

Multiple options available for investments:
Growth Option
Dividend Option - Payout, Reinvestment facilities

Minimum purchase amount:Rs. 500 per application.

Mr. Sandeep Kothari is the fund manager.

What is the benchmark index for Fidelity Tax Advantage Fund
Fidelity Tax Advantage Fund tracks the BSE 200 index and is an actively managed fund

Is the SIP facility available in Fidelity Tax Advantage Fund?
Yes, SIP or Systematic investment Plan is available.
For SIP: Rs. 3,000 (minimum single investment of Rs. 500 and in multiples of Rs. 500 thereafter, minimum 6 instalments).

What are the entry load and exit load charges for Fidelity Tax Advantage Fund
Entry Load NIL
Exit load NIL

What are the other competitor products to Fidelity Tax Advantage Fund
Tax Saving Investment Funds:
Lots and lots are availble, here are a few:

- Principal Personal Tax Saver Fund (ELSS),

- SBI Tax Advantage fund

- Reliance Equity Linked Savings Fund and many more

- SBI Magnum Taxgain

If you are looking for tax saving investments on the debt side, then there are these long term infrastructure bonds plus tax saving bond issues by various other government organizations

- IRFC Tax Free Bonds

- NHAI Tax Free Bonds issue

- HUDCO Tax Free Bonds

Then there are several infrastructure bonds issues currently open which will provide you tax savings like
1) IDFC Infrastructure Bonds for Tax Saving

2) L&T Infra Bonds for Tax Saving

3) SREI Infra Bonds for Tax Saving

Investors looking for tax savings have a lot of choice for investments in various financial instruments. One can take a call about which tax saving investment to choose based upon his own capital availability, tax bracket and risk appetite.