The Hindu Business Line : Mastershare to go open-ended

MASTERSHARE, the oldest mutual fund scheme in India, is set to undergo a major transformation. When its extended maturity period runs out, the scheme is to be converted into an open-end fund. Mastershare was launched in 1986 as a close-end scheme. The conversion will take effect on September 12.

As this is a change in the scheme's fundamental attribute, investors have been given an exit option at NAV in accordance with SEBI norms. The option is available between August 13 and September 11. From September 12, the fund will be open for sale of fresh units and redemption on a daily basis.

Investors who wish to redeem now will have to surrender the unit certificates duly signed. This is to be accompanied by a letter indicating the preference to exit.

Investors can stay with the scheme as this change will make the scheme's features more investor-friendly. Any exit decision can be evaluated and linked to performance rather than the conversion.

After September 12, statements of account will be issued for a range of transactions such as purchases, part repurchase. Unit certificates will be issued on a specific request made by the investor. The scheme code will remain unchanged at 017. So will the ISIN of INF189A01038 for dematerialised units. Even after the conversion, transfers and facility of pledging units using unit certificates will be available.

US 1995 dividend: The UTI Mutual Fund has announced a dividend of 10 per cent for the UTIN Unit Scheme 1995. The record date for the dividend is July 25. The dividend is exempt from tax in the hands of investors.

UTI Children Plan Bonus: UTI Mutual Fund has declared a bonus of 1:10 for the UTI Children's Career Plan. The record date for the bonus is July 31. The fund has an asset base of about Rs 1,000 crore. The fund has now invested 33 per cent of its assets in equities. The plan allows for investment in the name of children up to the age of 15 years to provide them means for financing higher education or meets other requirements.

Templeton Fund of Funds: Franklin Templeton has proposed to launch the Franklin Templeton India Life Cycle Fund. This `fund of funds' will invest in select equity and debt schemes of the fund house. Five schemes have been lined up: Franklin Bluechip, Franklin Prima, Templeton India Growth, Templeton India Income Fund and Franklin Templeton Income Builder Account.

The fund will offer three asset allocation models with different levels of equity and debt. The performance of this fund will basically depend on the trends in NAVs in the five schemes offered as options.

Standard Chartered Fund: Standard Chartered Mutual Fund has collected about Rs 380 crore in the initial public offering (IPO) of its Mid Term Plan. The plan closed on June 27.

PrucICICI Load: Prudential ICICI Mutual Fund has altered the load structure of its equity schemes. No entry load is payable on switch transactions between one equity scheme to another of the fund. There will be no exit load for investments in excess of Rs 5 lakh in the Prudential ICICI Income Plan.

For investments of less than Rs 5 lakh, a load of 0.5 per cent would be applicable if funds are pulled out within six months from the date of investment.

K-Floater: Kotak Mahindra Mutual Fund has launched K-Floater an open-end debt scheme. This fund will invest in floating rate debt instruments. The fund is targeted at investors aiming to cut interest rate risks of fixed rate debt paper. The minimum investment amount is Rs 5,000. There is no entry or exit load.

MF employee guidelines: SEBI has set out modified norms for investment and trading in securities by employees of mutual funds:

Approval of the compliance officer for a purchase or sale of security will be valid for on week instead of the present 10 calendar days.

Employees cannot profit within a period of 30 days from the purchase and sale.

These changes bring the norms in line with those of the SEBI insider trading regulations.

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