Aditya Birla Sun Life Mutual Fund launches Turbo Systematic Transfer Plan

Aditya Birla Sun Life AMC Ltd has launched turbo systematic transfer plan (STP), wherein unit-holders can opt to transfer variable amounts from a source scheme to a target scheme, at defined intervals.
 
In Turbo STP, the variable or actual amount of transfer to the target scheme will be determined based on the results from an in-house model, which helps ascertain market valuation.
 
The model tracks technical and fundamental parameters such as valuation ratios, trend ratios and volatility ratios, to arrive at an equity valuation multiplier (EVM). This value helps determine the actual amount to be transferred based on the pre-selected STP base amount.
 
Turbo STP enables unit-holders to transfer variable amounts from a source scheme to a target scheme at defined intervals. It also helps invest more when market valuation is attractive and less when market valuation turns expensive to optimize the investment growth potential.
 
The facility will be available in weekly, monthly and quarterly intervals.
 
Commenting on the launch, A. Balasubramanian, managing director and CEO, Aditya Birla Sun Life AMC, said, “Turbo STP is a facility for those market participants having lump sum amount to invest and are confronted with issues regarding market valuations, whether they are alluring or costly, and the amount they ought to contribute and for what tenure. It will help invest more at attractive market valuation levels and less when valuations are expensive."
 
Illustration:
 
Date – 1st day, Frequency – Monthly
 
Base installment amount (x) – Rs10,000/-
 
Number of installments – Default
 
Multiplier Range – 0.2x to 5x
 
If the latest EVM is 0.72, the matrix defines transfer of 0.2 times of base installment amount i.e. Rs2,000 will be transferred to target scheme from source scheme.
 
If the latest EVM is 1.31, the matrix defines transfer of 3.66 timers of base installment amount i.e. Rs36,600 will be transferred to target scheme from source scheme.
 
ABSL AMC services around 8.1 million investor folios with a pan India presence across 280 plus locations and had more than Rs2.93 trillion worth of assets under management (AUM) as of 30 June under its suite of mutual funds (excluding our domestic FoFs), portfolio management services, offshore and real estate offerings.

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Changes in Our Business Model
 
 
25th Sept 2020
 
Greetings from Moneylife Advisory Services
 
Between financial years 2019-21, SEBI has come up with extensive changes to investor advisor regulations. On Sep 23, 2020, SEBI had issued new additional guidelines. This comes just two months after extensive changes announced in July 2020. Earlier, in December 2019 there was an ad hoc circular
 
As a result of these changes, IAs, cannot accept fees through credit cards, will have to sign a 26-clause investor agreement, have to maintain physical record written & signed by client, telephone recording, emails, SMS messages and any other legally verifiable record for five years. IAs were already asked to record the suitability and rationale for every piece of advice given, sign them and store them for five years.
 
While these extensive and frequent changes, designed to strengthen the conduct of IAs are well-meaning, these have sharply increased compliance efforts and cost. We, being online advisors, find many of changes harder to implement, compared to advisors working in the physical space. We will have to have an army of advisors, administrative and tech staff to be compliant. If we do this, we will have to divert money to these areas and the cost of our service will double. We want to remain the least-cost service in the market to benefit more and more people. In the circumstances, we are forced to change our business model from “advisory” to “research”. This will mean the following:
 
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Debashis Basu
Founder