MUTUAL FUNDS IN INDIA – EXPERT OPINIONS

Axis Children’s Gift Fund is an open ended balanced scheme. The fund focuses on long-term investment and endeavors to help in saving for your child’s needs as he/she grows up. Investments in the fund can be planned for a child’s future be it education, marriage or just an investment for a rainy day.*. The fund will invest 40-60% in equity & equity related instruments while the balance will be invested in Fixed Income and cash futures arbitrage.

*Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Goals mentioned above are for illustration purpose only and there is no assurance that the goals represented above may be achieved.

As an AMC, we cannot comment on peer comparison.

Axis Children’s Gift fund is a dedicated product for investments on behalf of children. The ultimate beneficiary of investments in this fund can only be a Minor. Being a goal-orientated product, the balanced asset allocation pattern (40% to 60% in equity) has been designed so that while the fund has a potential for higher return than pure debt funds, it cuts the risk of losing money as compared to a pure equity fund.

There is a single plan in the fund which simplifies the investment framework with an asset allocation pattern akin to a balanced fund.

For operational purposes, there will be two series of NAV for both the options. However, from a valuation perspective, there is no difference.

As per the permissible limits, the fund can have 40-60% in equity, 5-15% in cash-futures arbitrage and the rest of 25-55% in fixed income instruments.

Please refer to product SID (Scheme Information Document) for more details.

In a normal situation, by no means can the invested money be withdrawn from the fund from lock-in option before the child turns 18 or 3 years whichever is later. In the event of death of the minor Unitholder (before attaining majority) during the tenor of the Scheme and where no alternate child has been named, the value of Units (at the redemption price) at the credit of the deceased minor Unitholder will be paid by the Fund to the legal guardian appointed by the competent court or where no such guardian has been appointed, to either parent of the minor Unitholder, or where neither parent is alive, to any other guardian of the Unitholder, which shall be a full and valid discharge of the AMC / Fund from all further liabilities in respect of the sum so paid. Please refer to product SID (Scheme Information Document) for more details.

Yes, apart from parents, grandparents, any relatives, any individual, minor himself/herself or a non-individual (For eg: companies, Partnership Firms, HUF, etc) can invest in the fund.

Please refer to product SID (Scheme Information Document) for more details.

Certainly. The fund focuses on long-term investment and endeavors to help in saving for your child’s needs as he/she grows up.  Investments in the fund can be planned for a child’s future be it education, marriage or just an investment for a rainy day.*

Below is the illustration on investing vs. borrowing:

Assuming the education cost is 25lac for a 5 year old child when he/she turns 18, below is the comparison on how you can save on your monthly outflow by investing when your child is young.

Source for education loan interest rate (11.45%): SBI (for education loan above 7 lacs). Assumed rate of return on monthly SIP is 11.45%

*Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Goals mentioned above are for illustration purpose only and there is no assurance that the goals represented above may be achieved.

As per research*, it is seen that cost of education has risen by 150% in the last 10 years.  Disciplined investment through SIP can help parents in setting aside funds for their child’s future systematically and get the benefit of compounding over a long term period.  Axis Children’s Gift Fund’s focus on long term investment approach can help investors bring in the much needed discipline and regularity in their investment habits.

Below is an illustration on benefits of early planning via SIP route:

Above data is only for illustration purpose and does not assure or guarantee any returns. This is an illustration to explain the concept of SIP & does not indicate the returns provided by any scheme of mutual fund. Above data is for monthly SIP considered to be made at the beginning of the month. Rate of returns is assumed @ 9%.

*Source: https://www.assocham.org/

The fund has a special feature of lock-in option. In this option, the investments can be redeemed only after 3 years or once the child turns 18, whichever is later. This feature will enable long term investment. When the child attains 18 years of age, the funds can be accessed only by the beneficiary. This seeks to safeguard the ultimate objective of the fund.

Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trusts Act, 1882, sponsored by Axis Bank Ltd. (liability restricted to Rs. 1 Lakh). Trustee: Axis Mutual Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC) Risk Factors: Axis Bank Limited is not liable or responsible for any loss or shortfall resulting from the operation of the scheme.

This document represents the views of Axis Asset Management Co. Ltd. and must not be taken as the basis for an investment decision. This document does not constitute advice to buy/sell any scheme of Axis Mutual Fund. Neither Axis Mutual Fund, Axis Mutual Fund Trustee Limited nor Axis Asset Management Company Limited, its Directors or associates shall be liable for any damages including lost revenue or lost profits that may arise from the use of the information contained herein. No representation or warranty is made as to the accuracy, completeness or fairness of the information and opinions contained herein.  The AMC reserves the right to make modifications and alterations to this statement as may be required from time to time.

#Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.