Capital Protection Oriented Scheme

1. Capital Protection Oriented Scheme Anuj Bindlish - 2010288 Vivek Parekh - 2010281

2. What Does it mean?? Was launched in year 2006

3. Wont you like to keep your hard earned money safe and also like to get better returns on it? A capital protection fund is a closed-ended hybrid fund invests 75-80% of its corpus in debt and the balance in equities. Over the term of the plan, the debt portion grows to the principal amount, thus ensuring that the capital is 'protected'. Meanwhile, the portion invested in stocks helps boost returns

4. Aim to protect and grow money

5. Advantages Capital is protected if the markets don't perform well Gains if the stock prices are buoyant. These funds give better returns than fixed income assets To attract investors who are not comfortable with taking interest-rate risks and market volatility It enables risk-averse investors to gain exposure to equities Certified by a rating agency

6. Why no to it ? These low returns during very high levels of inflation. Which in the past three years has been 7.3%, meaning that a fund earning 6-7% returns was not growing your wealth but eroding its value not even comparable to those of liquid funds and bank fixed deposits offer capital protection, without a guarantee the fund does not buy back before the maturity of the term these funds are illiquid because If u want to exit you will have to sell the units on the stock exchange. But there are hardly any buyers or sellers don't provide an interim income

7. Insipid returns in the past three years

9. SEBI Regulation Debt investment must be in highest rated investment grade papers e.g. high-yielding commercial papers and non-convertible debentures “Capital protection oriented schemes 38A. A capital protection oriented scheme may be launched, subject to the following: F.No. SEBI/LAD/DOP/ 0308 /2006 (a) the units of the scheme are rated by a registered credit rating agency from the viewpoint of the ability of its portfolio structure to attain protection of the capital invested therein; (b) the scheme is close ended; and (c) there is compliance with such other requirements as may be specified by the Board in this behalf.”

10. Thank You