DSP Merrill proposes gold fund
Kolkata: DSP Merrill Lynch MF plans to introduce an open-ended fund of funds, 'the DSP ML World Gold Fund' that will invest mainly in units of Merrill Lynch International Investment Funds, the World Gold Fund and would be benchmarked against the FTSE Gold Mines index.

The FoF will normally invest at least 80 per cent of its assets in overseas mutual funds while up to 20 per cent may be parked in money market securities or money market/liquid funds managed by DSP ML, the offer document filed with SEBI has mentioned. MLIIF - WGF is an `Undertaking for Collective Investment in Transferable Securities (UCITS) III Fund' approved by Commission for the Supervision of the Financial Sector, Luxembourg, with Merrill Lynch Investment Managers (Luxembourg) as the management company.

The fund tries to maximise returns by investing mostly in the equities of companies worldwide whose main business activity is gold mining. It is also free to invest in stocks of companies whose business relates to other precious metals and minerals. It does not hold gold or other metals in a physical form.

A 2.25 per cent entry load will be charged by DSP ML for regular purchases. In case of units bought through such regular purchase, a 0.5 per cent exit load will be charged if redemption is taken within 6 months. Aniruddha Naha has been named as the fund manager.

The offer document lists a number of specific factors that investors should be aware of. The FoF will depend chiefly on MLIIF - WGF, which in turn allocates mainly to equities of companies that are primarily into gold mining.
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MCX to set up commodity bourse overseas
Kolkata: Financial Technologies and MCX (FTIL-MCX) combine is planning to set up its second commodity exchange overseas shortly. Also on the cards is setting up of a management institute dedicated to creating human resource for commodity market. The new exchange would operate within MCX's focus area of metals, energy and large agricultural commodities. The proposed exchange would be in the Asia-Pacific region.

FTIL-MCX previously promoted Dubai Gold and Commodity Exchange (DGCX) in joint venture with Dubai Metals and Commodities Centre. DGCX, which began trading on bullion in November 22, 2005, had already spread its portfolio to currency (Euro, Pound and Yen) and is now planning to enter the energy segment with contracts on fuel oil (used in ships) and gasoline. It has also planned the launch of contracts on steel.

While fuel oil contracts may be launched in October, gasoline contracts are expected sometime in the first quarter of the next fiscal. According to a DGCX official, the exchange has been successful in attracting the interest of major players in the global bullion market like HSBC, Deutsche Bank, Mitsui and Standard Bank.
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Huge redemptions at Lotus Asset Management
Mumbai: The $100 million off-shore Lotus Asset Management Fund has seen huge redemptions following the exit of its equity head Sandip Sabharwal who had quit the firm earlier this month, citing personal reasons. However, rumours had it that he was asked to resign after his name figured in the CBI probes into the Ketan Parekh scam.

Though the exact numbers could not be confirmed, all investors except Temasek are understood to have redeemed their investments. Fullerton, an affiliate of Temasek, is one of the sponsors of Lotus Mutual.

Lotus, which had announced plans to launch its products after it got an approval from the capital market regulator some time ago is now looking desperately for a replacement for its equity head. There is an acute shortage of fund managers due to the growing number of fund schemes and new players. The problem is compounded by the fact that fund managers are now looking outside the industry for better deals.
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ICICI Venture plans 4 specialised funds
New Delhi: ICICI Venture is planning to set up four new specialised funds, including a small-cap fund, a mezzanine fund, a hedge fund, and a fund of funds.

The size of the small-cap fund will be around $500 million and will begin with a corpus of $200-250 million, which will be hiked to that figure within the next nine months.

The mezzanine fund will have around $100 million. ICICI is yet to formalise the size or the timing of the other two funds.

ICICI Venture has also tied up with seven of its key investors in its private equity funds that will co-invest with them in acquisitions and buying of stakes in companies.

As a part of its strategy to become a one-stop shop for investors, ICICI is looking at setting up a fund of funds, an equity fund that invests in other funds. A hedge fund (which will invest for a short period of time) is also being looked into.
At present, ICICI Venture handles assets of over $2 billion, and is the largest equity fund operating from India. ICICI hopes to double assets under its control to over $4 billion by 2010.
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New scheme from UTI Mutual Fund
Chennai: UTI Mutual Fund has launched a new scheme - UTI Wealth Builder Fund - which closes on October 11.
The fund is a close-ended equity scheme with a maturity period of 5 years with automatic conversion into an open-ended equity scheme upon maturity.

The scheme would invest in equity and equity-related instruments to the extent of 65-100 per cent and 0-35 per cent in debt and money market instruments.

The scheme would offer redemption/switch out of units on an ongoing basis at half yearly intervals at NAV-based prices.
The redemption/switch out will be available only during the specified redemption period; first five business days on half yearly basis after the closure of the scheme.

The minimum initial investment is Rs5,000 and in multiples of Re 1, thereafter without any upper limit. He said that the scheme offered two options, Growth option and dividend payout option. BSE Sensex is the benchmark index of the scheme.
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