Welcome to the second Funny Mutual Fund Show.
Bappa wished us goodbye yesterday and today Funnybone is back up and she is doling out humour and wisdom for all of us mortal investors.
Go ahead and give yourself some respite from the stress of your investments.
(Imagine some opening music for effect)
Me: Funnybone, I think, you didn’t answer my question from last time.
Funnybone: You don’t have any work except asking these stupid questions.
Anyways, which one?
Me: (little hurt!) What is Edelweiss MF’s speciality?
Funnybone: Ah! you so hell bent on this one. (pause)
So far, Edelweiss did have a speciality. Now it has lost it.
Me: Oh really! What?
Funnybone: Close to 100% of AUM at Edelweiss was in just 2 arbitrage schemes. Calling itself an arbitrage fund would have served it better.
In fact, calling it a mutual fund would have been an insult to it. (winks at me!)
Ah! but now it has lost the claim.
Me: (surprised!) But how?
Funnybone: (with a frustrated look) You are good for nothing.
It merged an entire fund house (JP Morgan) into itself. So, Edelweiss is now like just any other fund house.
Me: Oh! But you know it also announced something brave. Following DSP Blackrock’s announcement, it will now use Total Return Index (TRI) benchmark for performance comparison of its funds.
By the way, what’s this sudden rush to Total Return Index (TRI benchmark)?
Funnybone: What do you expect the ‘run out of ideas marketing managers’ to do. There is nothing unique in the funds they have.
This is the new way to get investors attention and get the AUM gravy train to keep moving.
Me: Hey! But isn’t it a good thing? Investors will get to see a true picture of performance and see if fund manager is actually doing the job.
Funnybone: (almost scolding) Who made you an advisor?
Investors don’t look at even the current benchmark returns, what will they do with the TRI? They are happy entering when the fund is doing well and hopping from one to the other with the same criteria.
Now, I am afraid when you talk Total Returns to the investor, she is going to think that she will get something extra.
Worse, she could think she was not getting the TOTAL thing before and has been shortchanged all this long.
(pointing a finger at me) Be ready for trouble!
(my head spins)
Me: You have gone crazy funnybone. Investors are much smarter now.
Funnybone: Yeah right!
That’s why the smart investor buys New Fund Offers.
And also doesn’t hesitate to have 30 different mutual fund schemes in the portfolio.
Me: Hmmm… You see change is happening. There is news that SEBI is going to push AMCs to reduce the number of schemes, merge similar schemes, thus help the investor make better choices.
Funnybone: What! Are you reading a newspaper from 2010? (laughs madly)
Funnybone can’t stop laughing!
So we will have to end this show now!
We will be back soon.
Till then take care.
(Imagine some closing music for effect)
The humour is in good spirit. No offence!
Do share your feedback and suggestions with me about the funny mutual fund show.