How can I invest in foreign mutual funds?
– Piyush Gupta
Several asset management companies (AMCs) offer funds that invest either directly or through other feeder funds into various international markets. Country specific funds invest in specific markets like US, Brazil, etc., region specific funds invest in certain regions like Europe, Asia, etc., and sectoral or thematic funds invest in commodity companies, real estate companies, etc. The performance of sectoral/thematic funds and country specific funds (particularly those investing in an emerging country) tends to be more volatile relative to those investing in developed markets.
l My agent says I have to do KYC each time I buy mutual funds. Is that true?
– P S Sunder
KYC for investing in mutual funds is a one-time exercise. Once completed through a SEBI registered intermediary (broker, DP, mutual fund, etc), it doesn’t need to repeated for other MF investments made through the same or another intermediary.
l Can I increase the equity exposure of my balance funds as the markets are going up now after some time?
– Jagdish Kumar
You may also like to watch this video
Balanced funds maintain an allocation of 65-75% to equity with the remainder in debt. The minimum 65% allocation to equity is to ensure that the fund qualifies for equity taxation. Further, the discretion to vary the allocation lies with the fund manager based on her market views. As an investor, in case you would like to manage the asset allocation you could invest in a mix equity funds or shares or ETFs, debt, etc., and rebalance the portfolio. But you should also consider the cost-benefit implications including transaction costs, taxation, etc., of frequent re-balancing. An annual review and re-balancing of one’s portfolio is normally considered adequate.
The writer is director, Investment Advisory, Morningstar Investment Adviser (India). Send your queries to email@example.com