Fidelity Equity Fund has announced 2nd dividend. Here’s the details:
Fidelity Fund Management Private Limited has announced its second dividend of Rs. 2.50 per unit (Face Value of Rs.10 per unit) in its open-ended, diversified equity fund, the Fidelity Equity Fund subject to availability of distributable surplus. All investors registered in the Dividend Option as on April 30, 2007 will be entitled to this dividend which will be tax-free in the hands of the investors.
April 25th, 2007
Fidelity Mutual Fund filed its draft offer documents to SEBI for its upcoming new fund offer - Fidelity International Opportunities Fund recently. The draft offer are made available on SEBI website for public viewing on Feb 28, 2007
Fidelity International Opportunities Fund is an open ended equity growth scheme with an objective to “generate long-term capital appreciation from a diversified portfolio of predominantly equity and equity related securities including equity derivatives in the Indian and international markets.”
The scheme will be available in Growth and Dividend (Payout and Reinvestment) options.
The Minimum Initial Application Amount is Rs. 5,000 per application. Minimum Additional Application Amount is Rs. 1,000 per application. Minimum Amount/No. Units for Redemption is of Rs. 1,000 or 100 Units. Interesting to note that the Minimum Balance Amount is Rs. 1,000.
For investments less than Rs. 5 Crores, there is an entry load of 2.25%; Exit load for redemptions or switch outs before 6 months will attract 1%. (Please see Fidelity’s document for complete details on this).
The fund compares itself with their custom benchmark created using the BSE-200 to the extent of 65% of portfolio and MSCI AC Asia Pacific ex Japan for balance 35%. This custom benchmarking would be necessary for performance comparison since a portion of their portfolio might invest outside India.
The investment pattern for this scheme is that 80 - 100% would go into Equity and equity 95% 80% to 100% Medium to High
related securities (including Indian and foreign equity securities as permitted by SEBI/RBI) and 0-20% into Money market instruments. Of course, Investments in Foreign Securities will not exceed the Eligible Investment Amount.
Our comments: This scheme looks attractive for risk taking investors who look for geo-diversification. Since small investors find it difficult to invest in international stocks (outside India) directly, investing in this fund would geo-diversify their portfolio. And since this is a mutual fund managed by experts (Fidelity is well known for its knowledge on global financial markets), investors need not have to worry about spending time to study, pick and understand international investments methods and processes.
The presence of an exit load of 1% if units are redeemed within 6 months if investment is a minus point for this fund. Though it is true that 6 months is too short time for the fund to really come out with great returns and that it will be always good for the investors to hold their investments for a long time, the presence of the exit load of 1% inspite of an entry load of 2.2% would make this scheme a bit unattractive.
March 2nd, 2007