Global Mutual Funds India: List of Global Funds in India

List of Global Funds available in India for investing in Global Mutual Funds. Add Global Funds to your portfolio of investments.
At some or the other point in time, each investor gets attracted to the prospect of making investments at a global level i.e. taking the global exposure to international companies and markets. We'll also discuss the benefits, advantages, disadvantages and risks involved in making investments in Global Funds, but let's being with the list of all available options for investing in Global Funds in India.

List of Global Funds in India

This list is not any particular order (like performance, etc. but just listed in a random fashion)
- AIG World Gold Fund: Deatils of AIG World Gold Fund.
Focussed on Gold, this fund is reported to give around 39% annual return in last one year.

- DSP BR World Gold Fund:
This is from the house of DSP BlackRock. Another global fundd focussed on Gold.
Last 1 year returns have been around 29%

Now, shifting away from Gold, here are the other Global Funds from other categories.

- DSP BR World Energy Fund:
Another Global Fund from DSP BlackRock house, focussed on Energy sector at a global level.
Energy has been a hot area for investments and such sector specific funds do offer a good opportunity to capitalize on the volatility. Last one year annual returns have been reported to be around 26%

- ING OptiMix Global Commodities Fund: ING OptiMix Global Commodities Fund Details
Another good sector specific option, but focussing on entire Global commodity space. Last one year returns have been around 25%

- Mirae Asset Global Commodity Stock Fund MAGCSF: Details of Mirae Asset Global Commodity Stock Fund MAGCSF. Another commodity focussed fund on global level from Mirae asset fund management.

- DSP BR World Mining Fund:
A fund investing your money in the mining sector, from the house of DSP BR. Last one year returns have been around 22%.

- Fidelity Global Real Assets Fund:
One of the largest fund managers across the globe, Fidelity has a presence in India with their Global fund called the Fidelity Global Real Assets Fund. This one is focussing on Real Estate and related businesses at global level. Last one year performance returns has been around 25%.

Birla Sun Life also has a lot of variety in offering for Global investments. Their global funds include the following:
- Birla Sun Life Global Agri Plan

- Birla Sun Life CEF Global PMP

- Birla Sun Life CEF Global MCP

What are the benefits and advantages of investing in Global Funds?
The biggest advantage is that you get opportunities to invest at a global level. Say, there may be problems in your local market like India - political unstability, high gap in demand and supply, etc. which might hurt the returns from this local market. Hence, having some investments in overseas companies and funds help you mitigate this effect. Suppose things are well and stable in USA and UK, then even though your domestic returns are taking a hit, your investments in global companies through these global funds will not get hit because of these local problems.
Global funds also offer diversification - across sectors, across countries, across geographies, etc. which again is an advantage of global funds.

What are the risks and disadvantages of investing in Global Funds?
The biggest risk is related to the advantage discussed above. What if your local market investments is stable but the overseas countries where your Global funds have invested has a problem. You will take a hit on that note - take example of Libya, Egypt, unrest going on now causing a hit on Crude Oil prices.
Then, there is currency risks - investments overseas has the implicit risk of forex charges and forex exchange rate risk. Even if your investments are going good outside, your net return might become low because of exchange rate changes

High Charges - Since overseas investments involve lot of money transfers and forex exchanges with various kinds of charges and stamp duties to be paid as per the country or market specific requirements, the fund management charges for Global Funds are usually high.
So weigh your pros and cons, and then decide to invest in Global Funds

Mutual Funds v/s ULIPs: What should investors invest in?

The recent happenings in the investment industry, expecially the recent ULIP related issues between SEBI and IRDA have raised quite a bells. Recently, the SEBI chariman, Mr. Bhave, was reported to have launched a scathing attack on Mutual Fund Houses (as quoted by ET), and was critical of the way the funds do business. Another development that happened was ULIP's were given a clear dictate - ULIP's are to be controlled by IRDA, not by SEBI. That has led to lot of worries for Mutual Funds, especially because sometimes back the Mutual Funds Entry load was scrapped by the regulators. That resulted in a big loss of income for these mutual fund houses. (See our thoughts on Should you trust your mutual fund manager?)

Mutual Funds v/s ULIPs: Which is better & What should investors select to invest?

In all these developments, one thing has come out clearly. There are lots of confusing financial products in the market and the investors interest are least thought about. Various AMC, Fund houses, Insurance Companies and other investment firms, come out with their own specially customised financial products, which may or may not ever meet the customer needs. They are sold through agents, who are guaranteed a hefty commission on each sale, and hence a lot of mis-selling happens. Simple because the agents are more interested in "Earning More Commission" rather than selling something which will actually benefit the customers or investors. More importantly, do such products exists which really are serving the purpose of investment like education policy, health plan, insurance plan and so on??? Please see this example Insurance v/s Investment v/s Tax savings – agent based business, where a good example is cited about how investors might fall prey to mis-selling and end up buying something which is not in investors benefit, but agents benefit.

Take a simple example - there is a good financial product which suits the purpose of your investment and it gives a 5% commission to the agent. Then there is another financial product which does not suit your investment purpose but gives 40% commission to the agent.
Now put yourself in agent's place - which policy will you sell - one that gives you 5% or one which gives you 40%?
You trust your agent thinking that he/she knows finance better and you go by his advice. But there is a good enough chance that the agent will sell you something which is not in your favour, but in his favour as a hefty commission.

The recent decision that ULIP's will be controlled by IRDA and not SEBI has sent cold waves across mutual fund houses. The reason - SEBI controls Mutual Funds, and it has (Rightly) barred them from charging any entry load or commission. So investors money is actually invested in full. The agent's commission and entry load are things of past.
However, for ULIP or Unit Linked Insurance Plans, they are controlled by IRDA, where there is no such restriction. It still remains a pure commission & agent based business. Some ULIP offer as high as 60% of first year annual commissions to agents. The industry avaerage is around 40%.

Now think about it. What will an agent sell? Something which will not give him any commission (Mutual Funds) or something which will give him hefty commisions (ULIPs)? Obsiously the answer is ULIP's. They come with loads and loads of conditions and strings attached. Investors need to remain invested for a long period like 15-20 years. Early exits (even like 5 years or so), might see even the invested money not being repaid in full.

So this is where we stand. The Mutual Fund Industry is worried that since agents are not allowed any commissions on selling Mutual Funds, the Mutual Funds will take a hit. On the other hand, the ULIP's will be (mis)sold with high recommendations by the agents, as they are going to give them high commissions. Another point is the word "Insurance". ULIPs stand for Unit Linked Insurance Plan - it has some component of money that goes towards insurance premium. However, the insurance cover provided is usually not sufficient and it ends up being a mix of insurance plus investments, with none of the two purposes achieved.

At this point, Investors should think twice before selecting an investment product. In my opinion, what SEBI is doing is correct - they are looking for investor benefits. ULIP's still require a lot of changes to really become a transparent and beneficial product to customers.

Natural Resources Classification: How are Natural Resources classified?

In this article, we cover details about the Classification of Natural Resources based upon various parameters. We have covered details about the Investments in Natural Resources through Mutual Funds and ETF or Exchange Traded Funds in the following articles: Natural Resources Mutual Funds: Investments & Risks and Natural Resources Mutual Funds & ETF List: Investments, Trading. In this article, we'll introduce you to the basics of Natural Resorces and how they are classified.

How are Natural Resources Classified?

There are several parameters or basis on which the natural resources can be classified. Here, we list some of them which are commonly observed:

Classification of Natural Resources based on Origin:
As we all know, natural resources occur "naturally". However, their origin can lead to different forms. Some of them are living while some are considered non-living. Looking at it from the point of what benefits the human race, every natural resource which can be exploited for some or the other reason can be called a "resource". So, if someone kills an animal like goat or bird like chicken for food, then its a resource for him/her. These fall under living resource category.

Then, there are some which do not fall in living category, like the ocean, the minerals, metals, etc. Hence, on the basis of origin, the natural resources are classified as follows:
Biotic Natural Resources : All Living Natural resources like birds, animals and some classified minerals which are formed by decay of living matter (like petrol and coal)

Abiotic Natural Resources: All non-living resources like ocean full of water, wind energy, sun, metals like iron, aluminium, gold, etc.

Classification of Natural Resources based on Renewability:
As we all are aware, resources can be categorized as renewable or non-renewable. Renewables are those which can be replenished easily without any extra efforts. Say for e.g. sunlight is available everyday during daytime, so if you miss charging your solar lantern today, then you can easily get it tomorrow (although weather sometimes play a role there). The same goes with ocean currents, wind energy, etc. So this parameter or renewability forms another basis for classification of Natural Resources:

Renewable Natural Resources: which can be replenished or reproduced in a speedy, fast and easy manner - like sunlight comes everyday.

Non - Renewable Natural Resources: Resources which are not easy to refurbish and take a long of time to replenish. The examples include formation of gold, coal, petrol, etc. which take ages to be created.

Classification of Natural Resources based on Development Stage:
A resource can be called a resource only if it is ready to use. So, you may find Bauxite ore, but unless you have the technology to extract Aluminium metal from the Bauxite ore, you cant really use it. So it can be said that Bauxite is the "Potential" Natural Resource. On the other side, once we have Aluminium metal extracted from the Bauxite ore, it becomes usable. Hence, Aluminium can be called "Developed on Actual Natural Resource". This usability leads us to the following classification:

Potential Natural Resources: Natural Resources which require further development like the Bauxite example cited above or extracting petrol from the crude oil

Actual or Developed Natural Resources: Natural Resources which are ready to use

Reliance Mutual Fund declares dividend for Banking, Pharma & ELSS Funds

Good news for the investors of Reliance Mutual Fund, the ADAG or Anil Dhirubhai Ambani led Reliance Mutual Fund Company.
The mutual fund house has come out with a bonanza offering of dividends for 3 of its funds and the amount of dividend being paid is also big. Here are the details of the dividend declared by the Reliance Mutual Funds:

Reliance Banking Fund: Dividend Amount 20 percent

Reliance Pharma Fund: Dividend Amount 15 percent

Reliance Tax Saver ELSS Fund: Dividend Amount 15 percent

Though in real terms, the value of NAV or Net asset value for each of these funds will drop down by the amount of money paid out in dividends. However, investors will benefit because without paying any exit load charges for these mutual funds, they can get a portion of their invested money back. The best is for the investors of the Reliance Tax Saver ELSS Fund, because the ELSS schemes actually lock in the money of the investors for a period of atleast 3 years. Hence, getting back 15% of this money will be additional benefit, in terms of liquiity

Natural Resources Mutual Funds & ETF List: Investments, Trading, Risks, Example & Introduction

In this article, we will list some of the commonly available and heavily traded Natural Resources Mutual Funds. We will also see if there are any cheap and low cost Natuaral resources Mutual Funds available or not. Due to the sudden crisis in the oil and gas markets, there is an outburst of funds in the Alternative Energy Fund segment. There is also a boost in the so called Natural Resources fund investments, which form another similar category along with Alternative Energy Funds and Green Funds.

We had covered in the following article about the Investments, Risks Introduction and examples of Natural Resources Mutual Funds

Are there any examples of Natural Resources Mutual funds available for investments?
Yes. Dreyfus Premier Natural Leaders (DNLAX), Franklin Natural Resources (FRNRX), Merrill Lynch/BlackRock Natural Resources (MDGRX), Morgan Stanley Natural Resource Dev (NREAX), Oppenheimer Real Asset (QRAAX), Pimco Commodity Real Return Fund (PCRAX) and Putnam Global Natural Resources (EBERX) are a few of the funds which are operating in the natural resources segment. But they may come heavy with the charges.

Are there any low cost Natural Resources Mutual funds available for investments?
An investor can opt for buying natural resource and commodity-oriented ETF or exchange-traded funds. These ETFs charge much lower fees than their managed fund counterparts and offer more diversity. Major Natural Resources ETF (Exchange Traded Funds) are:

DB Commodity Index Tracking Fund (DBC) Major Focus on - Futures contracts to track the Deutsche Bank Liquid Commodity index. Weightings are: crude oil (35%), heating oil (20%), gold (10%), aluminum (12.5%), corn (11.25%) and wheat (11.25%).

Energy Select Sector SPDR XLE Major Focus on - Oil company stocks.

iShares Dow Jones US Basic Materials IYM Major Focus on - Chemicals, base metals, mining forestry company stocks. (Not all commodities).

iShares Goldman Sachs Natural Resources IGE Major Focus on - Oil, oil services, base metals and mining company stocks.

iShares COMEX Gold Trust IAU Major Focus on - Gold.

iShares Dow Jones US Energy FundIYE Major Focus on - Oil company stocks.

iShares Dow Jones U.S. Oil & Gas Exploration & Production FundIEO Major Focus on - Oil exploration and oil company stocks.

iShares Dow Jones U.S. Oil Equipment & Services FundIEZ Major Focus on - Oil service company stocks.

iShares S&P Global Energy Sector IXCMajor Focus on - U.S. and foreign oil company stocks.

iShares MSCI Australia Index EWAMajor Focus on - Includes mining and natural resources company stocks.

Another option could be to buy stocks of natural resource and commodity companies directly. Examples of such companies inclide Alcoa (AA), Baker Hughes (BHI), Diamond Offshore Drilling (DO), Exxon Mobil (XOM) and Weyerhaeuser (WY). Here you will have to pay the standard brokerage charges for stock trading which may be less than the Natural Resources Mutual funds charges

Alternative Energy ETF Exchange Traded Funds and mutual funds

We had provided a good coverage and detail of ETF Investing: ETF Investments, Investments in Exchange Traded Funds and then we talked about the ETF Investments Risks & Precautions.
Spread over many other articles, we have tried to give our review of which ETF or Exchange traded funds are good. In this article, we attempt to summarize the same in a single article and also provide links to individual article which you may like to go through.

If you are looking for investments in the Solar Eenrgy Sector, then look no further than the Solar ETF. Though there are many solar etf's available for trading in the market, we have covered the below mentioned ones:
Solar ETFs:
KWT ETF: Market Vectors Solar Energy ETF: Van Eck Global Solar Energy ETF

TAN ETF: Claymore MAC Global Solar Energy ETF

If your interest is investments in Wind Energy Sector, then you can opt for investment and trading in the Wind ETF. We have covered the following Wind ETF:

PowerShares Global Wind Energy Portfolio Wind ETF

FAN ETF First Trust ISE Global Wind Energy Index Fund

If you are concerned about the environment and want your investments to improve along with the environment, then go ahead for investments in the Clean Tech ETF:
Clean Tech ETF: PowerShares Cleantech Portfolio ETF

Then, we also covered some of the Natural Resources Mutual Funds in the following article:
Natural Resources Mutual Funds

Socially Responsible Mutual Funds SRI:
Socially Responsible Mutual Funds SRI

Renewable Energy Mutual Funds
Renewable Energy Mutual Funds

Green Investments & Mutual Funds
Green Investing: Green Investments and Green Mutual Funds

Alternative Energy Mutual Funds
Alternative Energy Mutual Funds & Alternative Energy Funds Investment Performance Index

Reliance MoneyMall launched: Buy Financial Products Online

Anil Dhirubhai Ambani Group (ADAG) has come out with its online shopping portal, called RelianceMoneyMall and it is aimed at being a one stop online shop for all your financial products need. Reliance MoneyMall Site.

What all products are available for purchase at Reliance MoneyMall
You can buy Mutual Funds, Gold Coins, SMS Alert Packs for stock market related alert services, Technical Charts and Reports for getting an insight into the technical analysis of stocks, Books and Movies (again on Financial Sector - VCD/DVD are also available for tutorials), Gifts liks Soft toys, Apparels, Wallets, Shirts, etc., Home Appliances and Electronics like Mobile Phones, Consumer Electronics, laptops, etc.

Appears to be a one-stop online shop for various things - Reliance MoneyMall
Yes. Reliance MoneyMall is primarily into selling of the financial products, but it semms that they are going to extend into other areas as well. The reason might be because they may want to tap the online shopping market, which is still in nascent state in India.
FutureBazaar has launched its site for online shopping and they are also offering telephonic shopping. ADAG led Reliance MoneyMall will be a major copetitor to it. Then there is also a lot of competition for the elder brother Mukesh Ambani led Reliance Mart, which is also in Retail Shopping.

What is the process of buying through Reliance MoneyMall site
As any standard site, one has to register on the site. Select your product category and go ahead and make the payment for the items in your shopping cart.

What other partner products are available on Reliance MoneyMall?
There are all ADAG group partners as listed on their site. Reliance Capital, Reliance Money, Reliance General Insurance, Reliance Mutual Fund, Reliance Life Insurance, Microsoft and Standard are listed as the partner groups and sites. So all the insurance products, Financial Products and may be even software from Microsoft will be available for online purchase. Then, this is just the beginning. You may see a lot more items and categories which can add to the shopping list.

Renewable Energy Mutual Funds: Introduction, Example, Risks

Given the high level of volatility running in the markets around the globe, Suddenly from somewhere, this term Renewable Energy has become the hot favourite investment destination for the people willing to bet their money in the energy sector. Then there are news items which always talk about the latest happenings in the market, and there are enough material available on the internet on varioud news sites to talk about the Investments in Renewable Energy Mutual Funds.

So what is this concept of Renewable Energy?
As per Wiki, Renewable Energy is energy generated from natural resources—such as sunlight, wind, rain, tides and geothermal heat—which are renewable (naturally replenished). In 2006, about 18% of global final energy consumption came from renewables, with 13% coming from traditional biomass, such as wood-burning. Hydroelectricity was the next largest renewable source, providing 3%, followed by solar hot water/heating, which contributed 1.3%. Modern technologies, such as geothermal energy, wind power, solar power, and ocean energy together provided some 0.8% of final energy consumption.

Renewable energy Sources:
- Biofuels
- Biomass
- Geothermal
- Hydro power
- Solar power
- Tidal power
- Wave power
- Wind power

And then what is this concept of Renewable Energy Mutual Funds?
Basically, any mutual fund which invests in the stocks of companies which are in the business of Renewable Energy are called as Renewable Energy Mutual Funds
So, as a normal mutual fund which works on the principle of collecting money from individual investors, pooling in their money, investing in the select group of companies based upon the selected criteria or fund theme. The Renewable Energy Mutual Fund have the simple criteria that they will invest their money in companie which are in the business of making a profit from Renewable Energy.

Why are people looking for investments in Renewable Energy Mutual Funds?
People are drawn to renewable energy for one of several reasons:

Some environmentalist fundamentals lead people to go for investments in Renewable Energy Companies and Renewable Energy Mutual Funds. Reasons can be apelnty like :
- To fight Global Warming
- To prepare for Volatile Oil Prices.
- To improve Energy Security and local economies.
- To cash in on the above trends of Renewable Energy stock prices going high.

How Can I Invest in Renewable Energy Mutual Funds
It's as simple as selecting a Renewable Energy Mutual Fund which matches your style of investing and put your money in that. It may involve calling up your broker and placing the order with him. There are couple of Mutual Funds which focus on Renewable Energy sector. Below we name a few for sake of readers, but they are not necessarily our recommendations to buy - they are quoted as an example.

Related: Green Mutual Funds  Low Cost Mutual Funds   alternative Energy funds

For mutual fund investors, Renewable Energy focused mutual funds have been few and far between, but the recent growth of interest in the sector has lead to a plethora of new offerings. US investors have a choice like New Alternatives Fund (NALFX) and Calvert Global Alternative Energy Fund (CGAEX) and then there are the so called no-load Guinness Atkinson Alternative Energy Fund GAAEX. However, one should be careful about the load expenses which can be as high as 2%. Look before you leap. That's why it is advisable to go with industry ETFs.

As per the various resources availble on the internet, The Powershares Wilderhill Clean Energy ETF (PBW) and NASDAQ Clean Edge U.S. Liquid Series ETF (QCLN) have expense ratios currently capped at 0.60%, high compared to a general energy sector ETF such as XLE (0.24%), but is a much more economical way to invest than the sector mutual funds. Also recently launched, the Powershares Global Clean Energy Portfolio (PBD) has broader diversification into a greater number of small cap companies, but given its expense ratio of 0.75%, an investor with over $5,000 to put into the sector could closely replicate PBD by splitting his allocation 50-50 between GEX and PBW or QCLN.

is it safe or risky to invest in Renewable Energy Mutual Funds
That depends upon the market conditions. Market experts say that as the world continues to have high energy needs, we will have good scope for the Renewable Energy Investments.
But then, there is also a risk of mutual fund manager's performance. Ultimately, its your call as an investor to make investment or not.

No Load Mutual Funds: Introduction, Investments, Risks

Usually, investors often complain about the load charges or expense ratio that the fund managers charge to them in the name of fund management. This is one value which the investors look at very carefully before making any investment decision. Hence, many fund houses have come out with the concept of No Load Mutual Funds, or funds which basically do not have any charges taken from the investors in the name of investments in mutual funds and money management by professionals.

However, the terminology of load is not that simple. first let us look deeper into what is actually a LOAD when it comes to investments in mutual fund.

What is a Load in Mutual Fund Investment?
Mutual Fund Loads are fees or expenses taken or charged by mutual funds for compensation paid to brokers, their distribution network affiliates and to compensate for the sales and marketing costs. These expenses are usually known as the sales loads. They may also be called as the front end loads if they are charged to the investor while making an investment in the mutual fund. If similar charges are taken from the investors when they exit the fund or redeem their investment, then they are called back end loads.
Hence, the fund charges or LOAD charges can vary and cover a wide variety of charges. They can be charged when you enter into a fund or make a mutual fund investment or they can be charged when you exit from the mutual fund or redeeem your mutual fund units.

Say for e.g., if a fund has 2% entry load charges, and you invest 10,000 into that fund, then only 9800 of your money would be invested into the fund units. Rest 200 or 2% will be taken by the fund managers as entry load. Something similar may be applicable if there is an exit load. Say there is 1% exit load and your mutual fund investment value is 20,000 when you decide to redeem your mutual fund investment. Then your would recieve only 19,800 as the 200 or 1% of 20,000 would go towards exit load.

What are No Load Mutual Funds?
Now that you know what are the Load charges, we can now introduce the concept of No Load Mutual Funds. As the name indicates, no load mutual funds usually do not charge any sales loads to the investors of that particular mutual fund. No load mutual fund units are availabe for investment to the investors at the so-called "at-par" value of the fund or the equivalent net assets value of the fund. However, it is only the terminology that matters. Though the No Load Mutual funds claim be No Load, you as an investor, may still have to pay some charges or fees still chargeable to the purchasers of the funds. NASD allows mutual funds to charge some fees that are not considered as sales loads, so even through the fund may charge some fee in the name other than load charges, it can still claim itself to be a No Load Fund. Examples of such fees are exchange fees, purchase fees, redemption fees and account fees.

What is the advantage of a no load mutual fund?
Say if you are considering investing in 2 funds - one which has entry load charges of 2% and the other which does not have any entry load charges (No Load Fund). You decide to invest 10,000. So in the first fund, your actual investment would be only 9800, as 2% would go towards Load charges. In the second fund, since there are no entry load charges, your entire 10,000 would get invested. Hence, if both the funds have similar performance, the latter fund would give you better net returns. Also the compound interest factor returns would be higher in the latter fund, if you remain invested for longer time.

Are No Load Mutual Fund Investment always beneficial?
Not Necessarily and Not always. As we mentioned above, that it is only a matter of terminology. A so called No Load Mutual Fund may not charge any money to the investors in the name of load, but it may have some other fee and charges disguised in other terms. An investor should carefully look at these terms (or similar):
* Front End Load
* Front End Sales Charge
* 12b-1 Fees
* Deferred Load
* Actual Fees

Also be careful about the terms and conditions mentioned. A no load mutual fund may be no load only when invested for a period of 5 years. So if you decide to redeem your money before 5 year period, then you would end up paying a big amount of charges.
be careful with the sales person and agents who may not mention all the charges and conditions clearly to you. best way is to become knowledgable about the charges by carefully reading the brochuress and mutual fund prospectus yourself.
There is no guarantee that the no load mutual fund may perform better than the mutual fund with load.

New Alternatives Fund: NALFX Mutual Fund Review

There is a good mutual fund offering for the investors who are willing to encash upon the Alternative Energy Investment sector Funds. The fund belongs to Mutual fund house which has been the pioneer in investing in alternative energy sector and is called the New Alternatives Fund NALFX.

What is the New Alternatives Fund NALFX all about?
New Alternatives Fund NALFX claims to be the first Environmental Mutual Fund, which was launched way back in 1982 It had specific focus on the Alternative Energy Sector and has the accolades of being cited as the "Greenest Mutual Fund" in the United States by the leading newspaper – "The Economist". It also claims to be the socially responsible fund, taking investment as a part of social responsibility towards the environment and society.

Which companies does the New Alternatives Fund NALFX invest in?
The New Alternatives Fund NALFX invests primarily in the companies which fall into one of the following sectors:
• Alternative Energy: Reduces the dependency on fossil fuels.
• Recycling: Reduces energy consumption by re-using the material
• Clean air and Water: Water utility, Wind Energy and Waste processing
• Pollution Prevention:
• Conservation: Preventing forest degradation and conserving natural resources

Such funds make it a very good investments for environment cautious investors looking for Green Investments.

Which kind of investments are excluded from investments in New Alternatives Fund NALFX?
Oil, Coal, Weapons, Alcohol, Animal Testing, Tobacco, Gambling, Nuclear Power and any other company which are deriving their returns by investing in so called "socially irresponsible" investment, projects and technology are excluded from the investment in New Alternatives Fund NALFX.

What is the stock holding pattern of New Alternatives Fund NALFX?
As of 30th June 2008, The top 20 invested companies in the order of investment proportion are:

Vestas Wind Systems 5.09%, Gamesa Corporation Technologica 4.98%, Abengoa SA 4.23%, Iberdrola Renovables SA 4.19%, Acciona SA 4.01%, EDF Energies Nouvelles SA 3.95%, Brookfield Asset Management Inc. 3.85%, South Jersey Industries 3.79%, Schneider Electric SA 3.65%, Q-Cells AG 3.43%, Ormat Technologies, Inc. 3.32%, Koninklijke Phillips Electronics N.V. 3.14%, Companhia de Saneamento (ADR) 3.02%, American Water Works Co. 3.00%, Johnson Controls, Inc. 2.91%, Solar Millenium, AG 2.67%, Baldor Electric Co. 2.66%, Compagnie de Saint-Gobain 2.64%, Orkla-Borregaard AS, Inc. 2.60%, Nordex AG, Rostock-EUR 2.46%

What are the risk factors involved in New Alternatives Fund NALFX?
The primary risks involved in New Alternatives Fund NALFX are the same as that of any other mutual fund, like non-performance of the selected companies, and the selected sector. For e.g. if the alternative energy sector does not perform well, then the investment in this New Alternatives Fund NALFX fund will take a hit. However, the investment in New Alternatives Fund NALFX fund is a bit diversified since it invests in companies from various businesses like Wind energy, Solar Energy, Renewable Energy, etc.

There is another risk of Forex or foreign currency fluctuation. Since the investments are spread across global companies, it will be open to forex risk. (Effect of Forex on Stock Price: example of Foreign Exchange Risk)

Then comes the geo-political risk, tax laws, accounting risk and so on.

What is the current NAV or Net Asset value of New Alternatives Fund NALFX?
As on 28th July, the NAV for New Alternatives Fund NALFX stood at 48.42 USD.
MorningStar classifies the New Alternatives Fund NALFX fund as Mid cap Growth Fund and has assigned a rating of 4 stars to NALFX Fund.

Where can I get more information for investments in New Alternatives Fund NALFX? Interested investors may call the New Alternatives Fund NALFX toll free helpline no. 1-800-423-8383.

Table of Contents

Stock Mutual Funds

There are hundreds and thousands of mutual funds available in the market. On a broad basis, we can classify them as Mutual Funds based on Stocks/Shares and Mutual Funds based upon Debt Instruments like Bonds. Though there are other types of Mutual Fund instruments, like commodity mutual Funds, in this article, we would concentrate upon the Stock Mutual Funds only and discuss which are the best available stock mutual funds and how should an investor go about investing in such stock mutual funds or Equity mutual Funds.

What are Stock Mutual Funds OR provide an Introduction to Stock Mutual Funds?
In the simplest language, the stock mutual funds or "equity funds" are those mutual funds which invest their money only in stocks or shares or equities. Since stocks are considered to be risky, hence the stock mutual funds which are constituted only by Stocks are also risky, as compared to other types of funds, like bond funds or Money Market funds.
Though they come with high risk, along with that they are expected to provide high returns. It is usually assumed that stocks give better returns over the long run as compared to other instruments. They are also supposed to beat the affects of inflation. Whether these assumptions are true or not, is a subjective task, because investors like you and me have to take a call. Most of the investors do it by leaving their money to be managed by professional money managers who are supposed to understand the stock market better than the common man. Since we tend to leave the investment decisions to the mutual fund managers, atleast we should be aware about studying the stock mutual fund investment objectives and performance of the fund manager.

Which are the best performing stock mutual funds recently?
Though there is no guarantee of the returns from past performance of the stock mutual fund, it does give the pointers towards how the fund manager has performed. As per the various information available on internet sites, here are the Best Performing Stock Mutual Funds:

Top 3 best performing stocks mutual fund over the past 1 year:

Oppenheimer Commodity Strategy Total Return Fund: Offering from the Oppenheimer fund house, this fund investment objective is to seek total return. It is designed to provide investor portfolio diversification, long term growth potential and a hedge against inflation through exposure to commodities markets. The fund primarily invests in commodity-linked derivatives and investment-grade and non-investment-grade corporate bonds and notes. The fund may also invest up to 25% of its total assets in a wholly-owned and controlled subsidiary.

Commodities Strategy (A Class) Fund: Another Commodity Fund from the Rydex investments Fund house. The fund invests in in commodity-linked structured notes, ETFs that provide exposure to the commodities markets, and in commodity-linked derivative instruments, including swap agreements, commodity options, and futures and options on futures, and equity securities. It is non-diversified stock mutual fund and the expense ratio is 1.17%.

Goldman Sachs Commodity Strategy Fund : The fund invests in a portfolio of commodity index-linked securities (including leveraged and unleveraged structured notes), other commodity-linked securities and derivative instruments that provide exposure to the performance of the commodities markets, and in other fixed income and debt instruments. Under normal circumstances, it invests at least 25% of assets in commodity-linked structured notes. The fund is a non-diversified stock mutual fund.

Top 3 best performing stocks mutual fund over the past 5 year::

U.S. Global Investors Global Resource Fund: The investment seeks long-term growth of capital plus protection against inflation and monetary instability; current income is a secondary objective. The fund normally invests at least 80% of assets in the equity securities of companies within the natural resource sector. It may invest without limitation in the various industries of the natural resource sector, such as oil, gas, and basic materials. The fund invests at least 40% of assets in securities of companies that are economically tied to at least three countries other than the U.S. It is non-diversified stocks mutual fund.

BlackRock Global Resources Fund: The fund invests at least 80% of total assets in securities of global energy and natural resources companies and companies in associated businesses, as well as utilities. It may invest without limit in companies located anywhere in the world and will generally invest in at least three countries and in companies tied economically to a number of countries. The fund invests primarily in developed markets, but may also invest in emerging markets. It invests up to 20% of total assets in other U.S. and foreign investments. It is non-diversified stocks mutual fund.

Profunds UltraSector Oil & Gas Fund: The investment seeks daily investment results that correspond to 150% of the daily performance of the Dow Jones U.S. Oil & Gas index. The fund normally commits at least 80% of assets to equity securities contained in the index and/or financial instruments that have similar economic characteristics. It employs leveraged investment techniques and may use sampling techniques in seeking its investment objective. The fund invests assets which are not invested in equity securities or financial instruments in debt instruments or money market instruments. It is non-diversified stocks mutual fund.

ICICI Prudential launches Top Up plan in SIP & Mutual Funds Investments

You have “top-up” facility in your prepaid mobile phone recharge, now you can also avail the same facility in your investments in Mutual Funds from ICICI Prudential Asset Management Company.

Top-Up plan: For the first time in India, systematic investment plan with a feature of a “Top-Up” in the mutual fund industry has been announced by ICICI Prudential Asset Management Company.

Basically, this plan or this feature has the so-called top up facility. This top up facility allows the investors to increase their periodic investment or systematic investments through an automated route in multiples of Rs 500, on a pre-determined and regular basis.

Say for example you decide to get into a mutual fund managed by ICICI Prudential through a monthly SIP or systematic investment plan. In this plan, you decide to contribute 5000 per month. Now you opt for the top up facility and decide to increase you SIP amount after every year by 500 Rs. Hence, till one year, each month you would pay 5000 for the SIP investment. After 1 year, your monthly SIP investment amount will increase to 5500. After 2 years, it will become 6000 per month and so on.

The key benefits of the scheme are that it offers the flexibility to top up investment at pre-determined intervals of six months or 12 months. Also, it is said that the automatic features like a direct bank debit, or payment through debit card or credit card will provide execution ease in the investment process and reduce the efforts required by investor.

However, one of the biggest problems with this setup is that you will have to declare the top up amount and frequency before the commencement of the scheme. Say if you are willing to invest for 20 long years, you will have to make a prediction about your income and then take up the top up plan. There is no information available whether you can stop or basically – top-down – your investments based upon your situation. No information is available about the charges that the ICICI fund management will take if one wishes to top down or stop payment.

Related: ICICI RICH ULIP NFO Review, ICICI Prudential Focused Equity Fund

Another problem is that this top up plan is available through direct fund clearing, so one has to ensure that the increased amount is available at the specified date. What if your salary doesn’t reach your bank account on time and is delayed by a day or two?

Then the biggest question is about the consistent flow of funds. What if you loose your job after some time and do not have the extra money to invest? Can you come out of this scheme? What are the penalty charges? No info is given about that. ICICI has a very bad reputation when it comes to imposing penalties.

Investors are advised to be aware of these charges before making a long or short term commitment. If things go bad, the ICICI AMC will show no mercy on you while imposing charges and penalties. A good feature altogether, provided you are sure about what you want to achieve and whether you have consistent funds to honour your investment obligations or not.

Table of Contents

ETF of ETFs: Invesco PowerShares

The investment world keeps looking out for enormous and endless opportunities. New products are created every now and then.

I had introduced the concept of Fund of Funds in this article, and now, there are new financial products called ETF of ETF’s.

Basically, what these new ETF products will do is simply invest in other ETFs.
In the US, Invesco PowerShares Capital Management LLC has launched three exchange traded funds that invest solely in other ETFs. The funds — the PowerShares Autonomic Balanced NFA Global Asset Portfolio, PowerShares Autonomic Balanced Growth NFA Global Asset Portfolio and PowerShares Autonomic Growth NFA Global Asset Portfolio — are each pegged to an index of ETFs maintained by New Frontier Advisors LLC of Boston.

Now this is an interesting development. Be it fund of funds or be it ETF of ETF’s. The underlying concepts remain the same. Like a retail investor can on his own create a fund of funds by investing in his choice of funds, in the same way investors can create their own ETF collection. However, this ETF collection will be slightly different from the fund of funds.

The advantage with ETF’s is that you can trade them in real time on the stock exchanges as shares. So when you attempt to create ETF of ETF on you own, you do not have the liberty to execute the buy-sell orders for all the ETF in your portfolio. Hence, this is the place where the ETF of ETF will help you. Buying or selling one unit or share of ETF of ETF will ensure that you can actually trade in multiple ETF’s.

However, this liberty comes at a price. The investment cost price is relatively high. Including the cost of the underlying ETFs, the three ETF-of-ETFs will have expense ratios that run from about 0.75% to 0.86%, according to their prospectuses. Compare this to the actual ETF, the cost may be just 0.21%.

It’s a new product and it will take some time to see whether the investors really like this concept of ETF of ETFs. The biggest problem here is with the high cost of investment.

Table of Contents

After IPO, Mutual Fund NFO Performance also goes down

How have the New Fund offers or NFO offered in the past performed?

We have seen a lot of mayhem in the IPO market, where the Reliance Power IPO could not live up to the investors expectations, Wockhardt and Emaar MGF IPO were cancelled. Hundreds of other IPOs were either delayed or cancelled. How about the Mutual Fund NFOs? How have the recently launched NFO performed?

As per a new study, almost 72% of the total 28 Mutual Fund NFOs launched last year with a offer price of Rs. 10 are trading or having their NAV well below Rs. 10, in the price range of 6.7 to 9.7 Rs. Out of the remaining, only 18% are able to trade above the levels of Rs. 10.

The effect are so bad that even if a NFO appears to be a good buy in terms of the value it creates (??), then also the investors are not opting for it, given the high level of market volatility. Not only the actively managed funds, even the funds that were advertised as being backed by quantitative methods, where complex algorithms were used - have performed poorly.

The only exceptions to this trend however; have been the funds investing in gold or gold-related equities. The Gold ETFs (exchange traded funds) which came to the market last year are today trading at all time highs. Similarly with physical gold in great demand, the companies mining the precious metal are undoubtedly the major beneficiaries. And the results are getting reflected in the returns generated by the gold fund. Anyways, it’s only the timing that matters. Gold may be outshining stocks now, but silver is way ahead of gold in terms of pricing. Unfortunately, we do not have any silver based ETF.

It’s only a matter of time. Which instrument will give what returns in what time is not known by anyone.

Table of Contents

Where are rich investors investing their money?

Some interesting findings for the year - Where are the richest of the rich affluent investors putting their money and where they plan to put it in the coming year?

A research study conducted by The Phoenix Companies has come out with interesting results. As per the study, the affluent or rich investors invest significantly in both mutual funds and alternative investments, and half of them plan to change their investment allocations in the next year.

The detailed results of the entire study in detail is available at the following PDF file: (https://www.phoenixwm.phl.com/servlet/DocDelivery?DocId=docu_publ_advi_insight_0108.pdf&DocType=0)

Below, I aim to present the summary of the research study:

The research focused on 2 areas:
• Investments in mutual funds and
• Investments in alternative investments.
Alternative investments are defined as investments other than stocks, bonds or mutual funds, including real estate other than buying a second home.

In fact, 81% of respondents responded by mentioning that they have at least one mutual fund in their investment portfolio outside of a retirement plan like IRA, 401(k), 403(b), or other retirement plan and 74% of the respondents hold some or the other alternate investment.

Among the alternative investments, real estate (constituting around 45%) is the most widely held alternative investment, followed by exchange-traded funds (ETFs) (constituting around 30%), hedge funds/hedge fund of funds (constituting around 25%), and private equity funds (just over 20%).

This may come as good news to the Mutual Fund holders. Typically, I am NOT a person who would recommend investing in Mutual Funds because of the costs and fund management charges. But the 81% among the richest of riches having an investment in Mutual funds shows that they trust their mutual fund managers. Now I don’t know if the affluent investors get some rebate in terms of fund management charges or not.

Related: Should you trust your Mutual Fund Manager?

However, I am a biggest supporter of ETF’s or Exchange Traded Funds, and I am happy to see that 30% of the rich respondents trust that investment.

Related: Simplest Investment Strategy & An example of ETF or Exchange Traded Fund

That was about the past. What about the future? For 2008, the study reveals that affluent investors have no common plan when it comes to investment in these turbulent times.

49% of mutual funds owners and 52% of alternative investment owners said they will continue to invest the same amount or more in the coming year, while 51% of mutual fund owners and 48% of alternative investment owners expect to be bearish and invest less in the coming year. This shows a clear flipping and uncertain position.

So effectively, the investor mood is really really low when it comes to investor confidence in the economy. Call it the US recession fear, or the shaking up of global financial markets, the uncertainty that looms over the global markets is also reflected in the rich investors mood.

Table of Contents

Mutual Fund Performance: Debt v/s Equity

How have the mutual funds performed over the recent past? A study by Crisil Fund Services reveals some details. I usually do not recommend anything based upon the past results, as past performance of the mutual funds are no guarantee that the same will be carried on in the future. But its nice to see and learn about how the performance has been and observe what all is possible –which may be contrary to our assumptions.

Not surprisingly it was the Debt-oriented mutual funds that have continued to give positive returns in February, while almost all the stock or equity based schemes have given negative returns negative, as per the study conducted by Crisil Fund Services.

Crisil is a rating and performance monitoring agency and is in the business of providing fund valuations and assigning ratings to different bonds, companies and mutual funds and also provide risk management solutions to the Indian MF industry.

As per the news about the study , the highest monthly returns came from the liquid fund index, Crisil-LX, which was up by 0.66 per cent. This was followed by the Crisil STBEX, the debt index serving as benchmark for short-term bond funds and Crisil Fund-dX, the long-term bond funds index .
These returned 0.30 per cent and 0.28 per cent, respectively. Negative returns in this segment came only from the Crisil MF-Gilt index, the gilt funds index, which ended slightly lower at (0.02 per cent), a Crisil release said.

Meanwhile, all indices with equity components ended in negative over the month. The Crisil Fund-eX, the index for diversified equity funds, declined by 4.34 per cent, Crisil Fund-bX, the index for balanced funds, dropped 3.36 per cent.
Crisil MIPEX, the index used as a benchmark for monthly income plans, was down marginally by 0.13 per cent, it added.

However, even with negative returns in February 2008, it was the Reliance Mutual Fund which maintained the top spot. ICICI Prudential Mutual Fund retained the second spot and UTI Mutual Fund was at third place.

Always believing that more risky stocks will definitely give much better returns is a costly and highly vague assumption.

Markets work randomly – no one can be certain about what may happen tomorrow. Invest your money wisely and in the right instruments, and give it time to grow instead of playing around in short term trading.

Table of Contents