SEBI and IRDA are finalising rules for mutual funds and insurance companies to buy credit protection through credit default swaps (CDS), as RBI norms for trading in the product are set to kick in over the next few days.
CDS provides insurance or protection against the risk of borrowers defaulting. Bond market players, while recognising the need for a tool to hedge credit risk, expect the product to take off only gradually, due to the inherent challenges in the domestic Bond market.
News Source – ECONOMIC TIMES.
With banks' lending rates hitting a high, asset management firms have raised Rs 1.2 lakh cr through FMPs in 1.5 yrs. Indian companies have found an eager lender in asset management companies (AMCs). With interest rates rising 300 basis points in the last one-and-a-half years, AMCs have raised as much as Rs 1.2 lakh crore through fixed maturity plans (FMPs) and companies account for more than half of this. The same money is being used to fund companies by investing in their papers.
News Source – BUSINESS STANDARD.
Gold exchange-traded funds (ETFs) continue to rise in popularity. According to data provided by the Association of Mutual Funds in India (Amfi), the industry body of the Rs. 6.42 trillion Indian mutual fund (MF) industry, gold ETFs recorded their highest monthly inflow ever. A total of Rs. 1,234 crore came into gold ETFs in September alone. This is more than half of what they collected throughout the calendar year 2010. "Due to the approaching festive season, investors have bought gold ETFs. Also, many investors seem to have bought gold after the recent correction," says Kapil Mokashi, assistant manager-equity advisory, Sharekhan Ltd.
News Source – LIVE MINT.
NEW FUND LAUNCH
Pramerica Mutual Fund has unveiled a new fund named as Pramerica Credit Opportunities Fund, an open ended debt scheme. The New Fund Offer (NFO) price for the scheme is Rs 1000 per unit. The new issue remains open for subscription from 7 October to 21 October 2011.
News Source – NAV INDIA.
IDBI Mutual Fund has launched a new fund namely IDBI Gold Exchange Traded Fund, an open ended Gold Exchange Traded Scheme. The new issue will be open for subscription from 19th October to 2nd November, at an offer price of Rs. 100 per unit.
News Source – MUTUAL FUND INDIA.