Investment World
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Investment World
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Mutual Funds
US-64: What investors should do
S. Vaidya Nathan
INVESTORS as of June 30, 2001 should hold exposures of up to 5,000 units. The assured repurchase price of Rs 12 per unit backed by the Government guarantee makes this component safe.
As the NAV is just Rs 5.81 per unit, it may make sense for investors with over 5,000 units also to stay invested and exit at repurchase price in May 2003 at Rs 10 per unit. But in the intervening period if the NAV crosses the Rs 9.5 mark or Rs 10 (highly unlikely), investors should switch to other funds.
All investors who stay on till May 2003 to avail of the assured repurchase package should make sure they exit the scheme on May 31, 2003; otherwise they will lose the benefit of the bail-out package on offer.
Make sure you have all the documentation by April 2003 so that you do not miss out on the offer for any reason.
All investors, irrespective of their risk profile, would be better off with the income option till their exit in May 2003.
Investors should also avoid going in for the dividend re-investment option. If you are part of this already, it may be better to opt out of it.
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