Our range of funds provides access to different asset classes and sectors, allowing investors to diversify their exposure for a better management of their risks.
Diversification is the spreading of your investments across a range of assets such as stocks, bonds, real estate, gold, etc. and across a range of sectors, geographies and currencies, instead of putting all your money in a single asset or sector.
Diversification will not necessarily ensure gains or guarantee against losses. However, it may help to improve returns for whatever level of risk you choose to target. This can be achieved if you choose investments such as stocks, bonds, cash or others which are not correlated, i.e., their performance do not move in the same direction and to the same magnitude. In that way, even if part of your portfolio is declining, the rest of your portfolio is more likely to be growing, or at least not declining as much.
MCB Funds is a palette of a dozen of different products investing in different asset classes, sectors, markets and currencies. These funds are positioned across the whole risk-return spectrum providing a solution to almost all investor profiles, from the most conservative to the highly speculative ones. Investors are encouraged to invest in a mix of our funds, depending on their objectives and risk tolerance, to achieve increased diversification. Please contact our Client Relations Team to help you in choosing the most appropriate mix corresponding to your profile.
Our Mutual Funds offer the flexibility of investing as little as Rs.500 every month with the possibility of annual escalations, allowing a disciplined investment approach which can help you kick-start the building of your portfolio even with the little you can set aside as from today.
A regular savings plan is a direct debit payment plan which will be collected automatically from your bank account usually every month and will be invested in the product(s) of your choice.
One of the most difficult decisions in investments is “When to buy?”. Whilst it is true that the general rule is to buy when prices are low and sell when prices are high, in practice it is very difficult (even for professionals) to always time the low points. Investing regular amounts every month helps take the guess work out of the process as it allows you to catch both the high as well as the low points, with an overall lower average over the life of the investment period (a tactic usually called “dollar-cost averaging”).
Our Mutual Funds offer the possibility of starting a monthly savings plan with a minimum of only Rs.500 per month. Investors also have the flexibility of opting for an automatic annual escalation of either 5%, 10% or 15% annually. Once your bank account is debited, the cash is directed to the mutual fund(s) of your choice. You also have the flexibility to amend the investment amount (and the annual escalation %) at any time during your investment term. Please contact our Client Relations Team to guide you through our escalated monthly investment plans.
When you invest in our Mutual Funds, you join a community of hundreds or thousands of other investors which, pooled together, allows every single investor, however big or small, to benefit from the services of a professional investment manager and lower costs as these are shared between a larger pool of investors.
Pooling of funds refers to the process of gathering relatively small amounts from several investors which are then put together in a legal structure generally called a collective investment scheme which is then professionally managed to invest in different asset classes, markets, countries and/or sectors on behalf of all investors.
All our Mutual Funds are collective investment schemes which pool money
from hundreds or thousands of other investors, thereby allowing relatively smaller investors to
benefit from:
1. The services of a professional investment manager
2. Access to asset classes, markets and/or securities which require high minimums and which
would not have been
accessible to the investor on a personal basis and
3. Lower costs as all expenses particularly the fixed costs of the Funds are shared between the
hundreds or thousands of investors and
4. Better pricing as a result of bulk-buying which allows the investment manager to obtain
better terms and prices which are directly passed on to investors.
Knowing where your money is being invested, what fees and charges you should expect and having regular updates on the performance of your investments are key aspects of transparency when choosing to entrust your hard-earned savings into the hands of a third party.
One can easily get carried away by high return figures. For example, one can be tempted to invest in a product which has just delivered 10% over the past 6 months. But there are a lot of important considerations which an investor needs to factor in before doing so :
The documentation of our Mutual Funds (including the 2-pager monthly factsheets) prominently discloses all the fees and charges borne by an investor. Our quarterly and annual reports to investors provide a detailed portfolio of securities in which our Mutual Funds are invested. Our monthly factsheets provide the net returns of the investment products and the top 10 holdings of each Fund. Our annual statements help our investors to have a consolidated snapshot of their holdings and valuations. Registered users of MCB Internet Banking also have the possibility of viewing their investments (valuations are refreshed on a daily basis) online.
Investors have different needs at different stages of their lives. When we are young, we care more about growing our capital for the older days. As we grow older and ultimately reach retirement age, we are more focused on deriving regular income from our investments and prefer capital preservation.
There are generally two ways an investment delivers returns to the investor. First, through regular income throughout the life of the investment (usually in the form of annual or semi-annual dividends for stocks and mutual funds which represent a portion of the profits/income generated by the stocks/mutual funds or in the form of coupons or interests from fixed income instruments). The second source of return is capital gain which is the profit realised by an investor between the price the investment was bought and the price it is sold. Some investments provide a mix of regular income and potential for capital gains. The sum of both returns is referred to as total return from the investment. It is important to note that dividends and capital gains may have different tax treatments.
Investors have different needs which also change as they reach different stages of their lives. Usually, investors in retirement prefer to have regular income from their investments to supplement their occupational pension income.
Our Mutual Funds range provide a mix of semi-annual dividend-paying as well as non-dividend-paying products to cater for the varying needs of investors. Even if one particular Mutual Fund does not pay regular income, an investor in such a Mutual Fund can also partially redeem his/her investments on a regular basis (usually referred to as “systematic redemption plan”), thereby cashing out over time to meet liquidity requirements. Investors may also choose to reinvest their dividends (at no entry fees) in case some do not require the interim returns and prefer to put the money back to work into the Funds. Investors can change their dividends preference anytime and unlimitedly free of charge.
