Table of Contents
WHAT IS A MUTUAL FUND?
- A mutual fund is an investment vehicle where many investors pool their money to earn returns on their capital over a period.
- Debt funds (In Bonds) Equity funds (In Stocks) Hybrid funds(Both)
- Professional expertise
- Returns
- Diversification (Don’t put all your eggs in one basket)
- Tax benefits
- It is a global investment firm founded in New York City in 1947.
- It has over 455 different open-ended mutual funds and 7 closed-end funds.
- These schemes are-
- Franklin India Ultra Short Bond Fund, Franklin India Short Term Income Fund, Franklin India Credit Risk Fund, Franklin India Low Duration Fund, Franklin India Dynamic Accrual Fund,
- Franklin India Income Opportunities Fund.
FRANKLIN TEMPLETON CRISIS
- The decision to close the schemes has been taken to protect value for investors in light of the severe market dislocation and illiquidity caused by the Covid pandemic.
- These six funds, have direct exposure to the higher-yielding, lower- rated credit securities in India that have been most impacted by the ongoing liquidity crisis in the market.
- The combined size of these funds are Rs 25,856 as on April 22.
WHAT WILL HAPPEN TO INVESTORS WEALTH?
- However, the fund house has not announced details on how it will proceed with winding up of the scheme.
- But it has promised to announce the net asset value of the schemes daily.
WILL FRANKLIN TEMPLETON INDIA CLOSE?
- The move will only impact these 6 debt mutual funds.
- Templeton still has 7 other debt funds in its stable, with combined assets under management of about
- Rs 17,800 crore as on April 22.
- It also has-
- 15 equity funds worth Rs 36,663 crore and
- 11 hybrid category schemes with assets of Rs 3,143 crore.
THE BIGGER QUESTION?
- Association of Mutual Funds of India (AMFI)
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