Am planning to invest 1 lac in Aviva LifeBond 5 ULIP, and i may go in for growth option to get good returns, so can anyone suggest me if am taking a good decision or not? Is it worth to invest in AVIVA lifebond 5. Please update asap..
I have invested over 1 laks in taking Aviva's two lan namely, freedom life plan and life bond5 in which their growth and balance fund have been giving good returns. app 70%, is it advisable to invest more in this fund and what will be the long term returns of Dabur Aviva life insurance company?
RE:Investment in Dabur Aviva Life insurance
by Lisa on May 12, 2006 08:34 PM Permalink
The understanding for the NFO of Stanchart is grossly wrong. No one ever wrote or discussed that at any point of time even if the entire 100% of the asset are applied in IPOs, still 90% goes to NIFTY. This is because MF pays only 10% margin mony for the amount they applied. MFs cannot apply for more than their AUMs in all IPOs taken together. As maximum 10% goes in IPOs(even though the application size is worth 100% of the AUM); the remain 90% will always always remain invested in NIFTY(index of top 50 companies with inbuilt diversification)for 3 long years. Who says now that the fund will make short term investments?? If you still wants to understant this, give send an e mail at investwise123@rediffmail.com but please do not write anything which you do not understand.
RE:Investment in Dabur Aviva Life insurance
by Vishal Dixit on Apr 29, 2006 03:08 PM Permalink
Please do not invest in unit linked insurance plans in future. These are always very costly.
This message is to support my previous message. Please see my previous message before reading this. The StanChart fund can make money as long as the "hot market" lasts and the fund manager closes positions early, soon after the IPO, to book profit. The investment proposition, however, goes against the very idea behind in investing in mutual funds: to reap the benefits of diversification at a lower cost. Any way, the objective of the fund can not be refuted on the ground of irrationality, for reasons explained in my previous message.
IPOs are generally underpriced. Underpricing exists for a variety of reasons and will take pages to explain the empirical evidence. In "hot markets", underpricing is based on the sentimental price, which is higher than the fundamental price, established by a class of irrationaly exuberant investors. In the long run, such shares underperform, even though they are seemingly underpriced at the time of IPO. Issuers time the market to tap the opportunity offered by hot market. They sell to regular institutional investors who resell to naive investors. However IPOs die out soon after the "hot market" ends and only blue chips manage to raise money in IPOs after the hot market. Therefore the opportunity for profiting from the StanChart fund is as long as the "hot market" in India lasts. Thereafter there will be fewer IPOs and the fund will be flush with cash, if it manages to raise any now. Investors should be wary of this fact. However, the fund offers a short term profitable opportunity , since all applicants to an IPO do not stand the same chance as that of institutional investors, in getting allotment. Lijo, MSc - Finance (2005-06), University of Strathclyde (GSB), Glasgow,UK
It has become fashionable for all and sundry to talk as experts on investment management! I would like to know the credentials of the author of this article! To pooh pooh a fund from a reputed house such as Standard Chartered is outrightly outrageous. Call it by whatever name, there is an opportunity to make money in the IPOs. And to be cynical about the presumption that the bull run will continue.....the assumption applies for all equity funds....if someone does not think the equity markets will not do well, then they have no business to be in any equity fund.
And the final caution that investors should not park short term money in the fund, because it is a closed ended fund...it betrays the mind set of the writer.....talk long term...act short term!
I guess rediff.com should not have posted an article such as this
Well... seems like a good way for the guys who have an appetite for risk or have a good "techy financial" education... but then they would be investing directly in the stock market. don't see how a typical mutual fund investor would be interested in something like this.
hi, any investment in stocks is risky let alone IPO. Perhaps we can put it this way,It provides an opprtunity for people who can afford high risk and wants to invest in IPOs May be luck favours the brave? who knows
The Mutual Fund that is using investor funds for IPOs is basically working against it own character, that of providing an investing portfolio to an uninformed investor.Such a fund is banking on exploiting the greed of the investor for quick returns and whats more speculating on the stock market with the investors money. What's more it is making things difficult for retail investors in the stock market.What is the difference between group investing or an NBFC when established funds enter this route. Would they like these counterparts vanish or provide a raw deal to the retail investor.
