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  • Category: Mutual Funds

    Are are other SIPs starting at just Rs.100?


    The UTI has announced a Systematic Investment Plan for its Mastershare scheme. Do other mutual funds have similar schemes and are they really beneficial? Look for appropriate answers here.

    Members who know the actual picture may please respond.

    This morning, The Hindu, carried a very interesting advertisement, released by the UTI has announced a SIP (Systematic Investment Plan) starting at just Rs.100/- for its Mastershare scheme. This is great news, as even the lower middle classes will benefit from this scheme. The net savings cannot exceed Rs.20,000, even after seven years, and hence will not be taxed. This is a very good scheme.

    Do we have similar schemes for other Mutual funds? How is the performance of Mastershare now? I had invested in it long ago, and do receive some dividend. I have never checked on its viability, mainly because I do not know how the calculations are done.

    Can you please explain this?
  • #153031
    1. I am NOT an expert. There is absolutely no doubt about this fact.

    2. As far as I know, presently very few mutual fund houses offer SIP of Rs. 100/- p.m.

    3. Only Reliance mutual fund house offers SIP of Rs. 100/- in respect of very select few of its schemes.

    4. Not only that, most of the mutual fund houses offer SIP of Rs. 1000/- p.m. Very few fund houses like Quantum mutual fund house offer SIPs of Rs. 500/- p.m.

    5. Please check whether the SIP (of Rs. 100/-) offered by UTI Mastershare is weekly or monthly. The SIP of Rs. 100/- (per week) is possible and the advertisement may be worded in such a manner so that it attracts the attention of potential investors.

    6. Last but not the least, even if the SIP offered is Rs. 100/- p.m., if any investor goes for it, the accumulated wealth would not substantial even after investing for 10 years and the rate of return is very high.

    Beware! I question everything and everybody.

  • #153032
    It is the new news to me and every one. Let the experts of this site also give their valuable opinion and then we can think of investing the same. Financial experts please respond.
    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #153033
    The following are the SIPs which are accepting Rs.100/- minimum monthly investment.
    1. Reliance Small Cap Equity Oriented Mutual Fund
    2. Reliance Banking Fund.
    3. Reliance Regular Saving Fund Equity and balanced
    4. Reliance Top 200 fund
    5. Reliance Float Rating Fund Short term
    6. Reliance Gift Security fund
    7. Reliance Monthly income plan
    8.Reliance Arbitrage Advantage Fund
    9.Reliance Pharma fund.
    All the above are floated by reliance. The returns are good.
    There are many other SIPs where the minimum investment is Rs.500/- only.
    I personally feel investing Rs.100/- may not give you good amounts which can be used for a specific purpose. So I personally feel that Rs.500/- may be a better option for SIPs. But it depends on the individual's interest and capability.
    SIP investment is definitely a good option

    drrao
    always confident

  • #153037
    1. As far as I know, presently only one mutual fund house offer SIP of Rs. 100/- p.m. Only Reliance mutual fund house offers SIP of Rs. 100/- in respect of very select few of its schemes.

    2. Not only that, most of the mutual fund houses offer SIP of Rs. 1000/- p.m. Very few fund houses like Quantum mutual fund house offer SIPs of Rs. 500/- p.m.

    3. Please check whether the SIP (of Rs. 100/-) offered by UTI Mastershare is weekly or monthly. The SIP of Rs. 100/- (per week) is possible and the advertisement may be worded in such a manner so that it attracts the attention of potential investors.

    4. Last but not the least, even if the SIP offered is Rs. 100/- p.m., if any investor goes for it, the accumulated wealth would not substantial even after investing for 10 years and the rate of return is very high.

    5. UTI Mastershare was earlier considered an excellent and trusted scheme, but of late, many other large-cap mutual fund schemes have been performing better than UTI Mastershare. Value research keeps it in the 3-star category. But even now, it is very good, if not the best within the category.

    Beware! I question everything and everybody.

  • #153038
    Traditionally, SIP were designed for a minimum monthly investment amount of Rs 500. Later some mutual funds started as low as Rs 100 and now many are following this.

    The low contribution is only for the people who have little surplus funds from their earnings. In that respect this scheme mimics the old chit funds or daily deposit schemes in local small bank type entities which were of course not very reliable but did brisk business from a large number of poor and lower class people.

    So financially this has not much significance for the main stream investors.

    Regarding tax liability, the lower class people are already out of the tax net so for them it does not matter whether the cumulative amount of this SIP is taxable or not.

    So, SIP of Rs 100 per month is only an ease of investing for low end investors. It has no other implications.

    Knowledge is power.

  • #153039
    SIP plan was devised to offer a substantial gain to investors after the expiry of specified periods. The nature of funds may varry such as Equity - share, Balanced - fund, Debt - funds etc. Initially the investment- money was less - around Rs 100/- which you have noticed in respect of UTI fund.
    Reliance still caters to the need of investors offering SIP fund of low value - as little as Rs 100/- in the different caps such as - Reliance monthly income - plan, Reliance Pharma - fund, Reliance Top 200 fund etc.
    But one must keep in your mind that the accumulated amount by way of investing Rs 100/ per month would not fetch an attractive amount even after the specified period and hence such funds don't appear attractive. Again inflation would eat away your gain because of inflationary- pressure.
    You may think of investment of higher denomination such as Rs 1000 per month in some Balanced - funds so as to get attractive yield at the end of the period.

  • #153128
    TThis response is marked as DELETED by the admin.

    This Forum post raised on 1st October, 2018 was later converted to AE Question. But just now I have noted that the answers to the question have not yet been reviewed.
    Beware! I question everything and everybody.


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