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A Reliance Capital company “A unique facility to Save, Grow & Insure” Reliance SIP Insure.

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Presentation on theme: "A Reliance Capital company “A unique facility to Save, Grow & Insure” Reliance SIP Insure."— Presentation transcript:

1 A Reliance Capital company “A unique facility to Save, Grow & Insure” Reliance SIP Insure

2 What Rs 2000 p.m can get you…. A sumptuous luxurious dinner for your family Visiting your nearest relative place Buy your monthly grocery Make you a Millionaire* & also get you free life insurance on your SIP installments *please refer slide 3 for more details

3 What does it take to create wealth… Value /Yrs ,00,00012, ,5001,200 10,00,00023,80013,0004,9002,400 25,00,00060,00032,50012,2006,000 50,00,0001,20,00064,50024,30012, ,00,0002,38,0001,30,00048,50024,000 This is just an illustration, explaining the power of compounding concept and should not be assumed as a promise, guarantee or forecast on minimum returns and safeguard of capital. SIP does not assure a profit or guarantee protection against loss in a declining market. The calculation shows the outcome of investing a specified amount at a certain assumed rate of interest per annum. The table shows the SIP amount required to be invested per month for achieving the target amount in the specified time period. The hypothetical rate of return on the investments is assumed at 10% p.a. Investing Rs 2400 per 10% p.a for 15 yrs makes you a Millionaire

4 Most likely reasons to invest….. Everyone has one or more of the above reasons to invest for! Child’s Education Child’s Marriage Housing Retirement Safety

5 7 Successful habits of investing  Start early  Don’t time the market  Prudent Asset allocation  Invest regularly  Understand the risk reward ratio  Have a set investment objective  Invest for long term Would you like to guess the 8 th habit that we got for you?

6 Insure your financial goals….. Before we know more about this product….let us understand the investment climate around us!

7 Value of Money over time 5% p.a Inflation – A Devil, we need to beat it!

8 Where do people save their money? Source: Invest India Incomes and Savings Survey 2007** Mutual Fund as an Asset Class has a very low penetration

9 Its not the timing but the time in the market which matters Long Term Investing – Case Studies Invest Systematically…..

10 Invest Long term… Money grows over a period of time… Rs 1000 invested at 8%p.a every month for… … just like a rolling snowball gathers snow & grows. This is an hypothetical illustration to explain the concept of “Power of Compounding”. Past Performance may or may not be sustained in future.

11 It always pays to start early & save for retirement B holds for 20 years A holds for 30 years  A & B invest Rs every month, earning 8% p.a. on a monthly compounding basis  A starts at the age of 25 yrs, while B starts investing at the age of 35 yrs  Both of them invest for 5 yrs ( Rs. 1.2 lacs) and hold their investments till 60 yrs. of age  A’s investment appreciated to over Rs.14,88,603 while B’s investment grew to only Rs. 6,89,511 Only an illustration to explain the power of compounding.

12 & Don’t Time the Market… ScenariosInvestor buys at Market Peaks Investor buys at Market Lows Investor buys at constant interval BSE Sensex16.69%23.09%19.12% BSE %24.73%20.58% Reliance Growth Fund-Retail Plan- Growth Plan – Growth Option* (RGF) 36.65%42.13%38.28% Reliance Regular Savings Fund-Equity Option- Growth Plan * (RRSF- EQ) 27.16%47.92%36.03% Rs 10,000 invested every year for a period of 12 years in RGF from Jan 96 to April 08 & in RRSF- EQ for a period of 3 years from June 05 to April 08 Past Performance may or may not be sustained in future. *Returns as on 30 th April 08

13 Past Performance of SIP in Reliance Growth Fund RGF BSE 100 SIP Installment /Yrs3510Since Inception 2,000 1,13,3433,71,04324,21,36744,37,506 1,10,9262,77,3119,09,32812,75,183 3,000 1,70,0155,56,56536,32,05166,56,260 1,66,3904,15,96713,63,99219,12,775 5,000 2,83,3599,27,60960,53,4191,10,93,766 2,77,3176,93,27922,73,32031,87,958 10,000 5,66,71818,55,218.1,21,06,8392,21,87,533 5,54,63413,86,55945,46,64163,75,917 15,000 8,50,07827,82,8271,81,60,2583,32,81,300 8,31,95120,79,83868,19,96295,63,875 Inception Date: 8th Oct Returns are of Retail Plan- Growth Plan – Growth option as on 30th April 08 Past Performance may or may not be sustained in future. The above table shows the historical SIP performance of Reliance Growth Fund (Retail Plan – Growth Plan – Growth option) vis its benchmark BSE 100. For example; A person who had made an SIP of Rs 5000 p.m in the above fund since inception on 8 th Oct 1995 would have invested Rs 7.55 lacs by 30 th April 08 and have earned a total amount of Rs 1.10 crs (As per the highlighted cell)

14  Simple, straightforward way to create long term wealth  Understand and embrace risk  Put time on your side  Invest systematically  Don’t worry about market timing  A tried & tested method 2 Make the right choice….  The alternative is to : Follow markets very closely Time your entry and exit very well Select your stocks judiciously And hope that you get it right more often than not! The choice is yours to make……….. 1

15 Systematic Investment Plan (SIP) & its benefits Inculcates savings habit Eliminates need for timing markets Helps averaging cost of investment Protects against market volatility Improves probability of better returns SIP is a long term investment technique under which you invest a fixed sum of money on a monthly or quarterly basis in a mutual fund scheme at the prevailing NAV. This allows you to save and invest regularly while you are earning.

16 Are you looking at investing for the long term?? Do you want a free life insurance cover?? Do you want an investment technique which can make you invest regularly?? Do you want your planned investments to be completed after your unforeseen death?? then Choose Reliance SIP Insure Here comes the most sought after product……..

17 “A unique facility to Save, Grow & Insure ”

18 Investor Benefits- “Save, Grow & Insure” Inculcates savings habit Free Life Insurance Cover- Enjoy Insurance on SIPs Eliminates need for timing markets Helps averaging cost of investment Ensuring that the planned investments are completed Market Linked NAV based maturity proceeds Why Reliance SIP Insure ?

19 An add-on feature of life insurance cover under a Group Term Insurance provided to individual investors with a view to encourage individual investors to save and invest regularly through Systematic Investment Plan (SIP) and help them achieve their financial objective without any extra cost. Objective: In the unfortunate event of death of an investor before completing the opted SIP tenure, the balance amount towards the SIP installments remaining unpaid shall be made good from the life insurance cover and the nominee* would be able to continue in the scheme without having to make any further contribution Reliance SIP Insure- What is it? *Nominee account would mean nominee in case of single holding & second or joint holder in case of Joint Holding

20  Minimum Investment per installment : Rs.2000 per month. There is no upper limit  Minimum Period of Contribution : 3 years and in multiples of 1 year thereafter.  Maximum Period of Contribution : 15 years OR till attaining 55 years of age, whichever is earlier (e.g., a person can register an SIP of maximum 10 yrs at the age of 45 yrs.) The insurance cover ceases when the investor becomes 55 years of age.  Mode of payment of SIP installments is only through Direct Debit & ECS ( Post Dated Cheques shall not be accepted ) Reliance SIP Insure – Product Features Eligibility  All individual investors enrolling for investments via SIP and opting for ‘Reliance SIP Insure’  Only individual investors whose completed age at entry is greater than 20 years and less than 46 years.  In case of multiple holders in the any scheme, only the first unit holder will be eligible for the insurance cover. Investment Details

21 Load Structure  The Entry Load under Reliance SIP Insure shall be same as applicable to normal purchase /additional purchase transactions.  However, there will an Exit Load of 2%, if the accumulated units acquired or allotted under Reliance SIP Insure are redeemed or switched out to another scheme before the maturity of SIP tenure as opted in the respective scheme either by the SIP-Insure unitholder or by the nominee, as the case may be.  In the event of the death of the unitholder, if the Nominee chooses to redeem the outstanding balance of units before completing the opted SIP tenure the repurchase of units shall be subject an exit load of 2%  However, if the units are redeemed on completing the opted SIP tenure, there will not be any exit load in the respective scheme. Reliance SIP Insure – Product Features

22 Commencement of Insurance Cover: The Insurance cover shall commence after “waiting period” of 90 days from the commencement of SIP installments. However the waiting period will not be applicable in respect of accidental deaths. Amount of Life Insurance Cover Available  An amount equivalent to the aggregate balance of unpaid SIP installments, subject to a maximum of Rs.10 lakhs per investor across all schemes / plans and folios  This amount will be invested in the Nominee’s account, in the same scheme/s under which the deceased investor has enrolled for SIP  The investment will be at the applicable price based on the closing NAV on the date on which the cheque for insurance claim settlement is received by the AMC from the insurance company, subject to completion of requisite procedure for transmission of units in favour of the nominee. Reliance SIP Insure – Product Features

23 This amount will be paid by life insurance company to SIP investor’s nominee account * with Reliance Mutual Fund and will be invested in Reliance Growth Fund (in the same scheme in which the deceased has earlier invested) Reliance SIP Insure– How does this work? An investor does a monthly SIP of Rs. 10,000 for 5 years in Reliance Growth Fund If he dies after a period of 3 yrs, then his Sum Assured= Unpaid SIP installments = 2 yrs ( 5 yrs-3 yrs) X 12 months X 10, 000 = Rs 2,40,000 *Nominee account would mean nominee in case of single holding & second or joint holder in case of Joint Holding

24 Reliance SIP Insure – Product Features Life Insurance Cover/Yrs ,000,000 27,778 16,667 8,334 5, ,000 25,000 15,000 7,500 5, ,000 22,222 13,333 6,667 4, ,000 19,444 11,667 5,833 3, ,000 16,667 10,000 5,000 3, ,000 13,889 8,333 4,167 2, ,000 11,111 6,667 3,333 2, ,000 8,333 5,000 2,500 1, ,000 5,556 3,333 1,667 1, ,000 2,778 1, One can aim to have a target insurance cover as per one’s requirement by referring to the matrix attached below Cells in yellow would not be applicable under Minimum SIP amount category under Reliance SIP Insure Facility The table shows the SIP amount per month to be invested for the required combination of Eligible Insurance Cover & Tenure. For example, to have a maximum cover of Rs 10 lacs at the time of registration in Reliance SIP Insure Facility, one can invest Rs 5,556 p.m for a period of 15 yrs as per the cell highlighted in pink.

25  If the aggregate total of SIP installments remaining unpaid under all schemes is less than or equal to Rs. 10 Lakhs, then the life insurance cover shall be equal to the actual unpaid balance in the respective schemes.  If the aggregate total of SIP installments remaining unpaid under all schemes is greater than Rs. 10 Lakhs & all the SIPs start on the same date, then the life insurance cover shall be equal to Rs. 10 Lakhs, which shall be allocated / invested proportionately in the respective scheme folios.  If the aggregate total of SIP installments remaining unpaid under all schemes is greater than Rs. 10 Lakhs & all the SIPs start on the different dates, then the life insurance cover shall be equal to Rs. 10 Lakhs, which shall be allocated / invested on First in First out basis in the respective scheme folios. Reliance SIP Insure – Product Features

26 Eligible schemes  Reliance Growth Fund - Retail Plan  Reliance Vision Fund - Retail Plan  Reliance Equity Opportunities Fund - Retail Plan  Reliance Equity Fund - Retail Plan  Reliance Equity Advantage Fund- Retail Plan  Reliance Regular Savings Fund – Equity option  Reliance Regular Savings Fund – Balanced option  Reliance Banking Fund  Reliance Pharma Fund  Reliance Media & Entertainment Fund  Reliance Diversified Power Sector Fund – Retail Plan Reliance SIP Insure – Product Features

27 The insurance cover shall cease upon occurrence of any of the following:  At the end of mandated Reliance SIP Insure tenure, i.e., upon completion of payment of all the monthly installments as registered.  Discontinuation SIP installments midway by the investor i.e., before completing the opted SIP tenure /installments.  Redemption / switch-out of units purchased under Reliance SIP Insure before completion the mandated SIP tenure / installments  In case of default in payment of two consecutive monthly SIP installments or four separate occasions of such defaults during the tenure of the SIP duration chosen. Reliance SIP Insure – Expiry of the policy

28 No insurance cover shall be admissible in respect of death of the SIP-Insure unitholder (the insured person) on account of -  Death due to suicide  Death within 90 days from the commencement of SIP installments except for death due to accident.  Death due to pre-existing illness, disease(s) or accident which has occurred prior to the start of cover. Reliance SIP Insure – Exclusions for Insurance cover

29 It is mandatory for each investor to sign and submit the following documents under this facility;  Application Form  ECS/ Direct Debit Form  Personal Statement of Health  Authorization Mandate (which forms a part of application form) Reliance SIP Insure – Documentation For our existing investors there is no need to give the first SIP cheque

30  Reliance SIP Insure facility is an add on feature of life insurance cover under Group Term Insurance to individual investors opting for SIP in the designated schemes.  Reliance SIP Insure provides free life insurance cover to investors at no extra cost. In the unfortunate event of the death of an investor during the tenure of the SIP, the life insurance company will pay for the balance amount towards the remaining unpaid SIP installments. An amount equivalent to the aggregate balance of unpaid SIP installments, subject to a maximum of Rs.10 lakhs per investor across all schemes /plans and folios will be invested in the Nominee’s account  The said facility is provided in selected equity schemes of Reliance Mutual Fund  Only individual investors whose completed age is greater than 20 years and less than 46 years at the time of investment.  In case of multiple holders in the any scheme, only the first unit holder will be eligible for the insurance cover.  Minimum Investment per installment: Rs.2000 per month & in multiples of Re 1 thereafter. There is no upper limit  Minimum Period of Contribution: 3 years and in multiples of 1 year thereafter.  Maximum Period of Contribution: 15 years OR till attaining 55 years of age, whichever is earlier (e.g., a person can register an SIP of maximum 10 yrs at the age of 45 yrs.) The insurance cover ceases when the investor attains 55 years of age.  Mode of payment of SIP installments is only through Direct Debit & ECS ( Post Dated Cheques shall not be accepted ) Reliance SIP Insure – Snapshot The group term cover will be approved only after underwriting acceptance of the Personal Statement of Health

31 Invest India Incomes and Savings Survey 2007 **The Survey consisted of two components: 1. Complete household listing (over one million households) from randomly selected 1815 wards covering 852 towns and 931 villages, and 2. 96,088 representative individual respondent interviews (urban sample 72,979 respondents and rural sample of 23,109 respondents) carried out in the same locations. Respondents were drawn mainly from earning members of the Indian workforce who derive cash incomes from salaries, wages, profits and earnings from self employment and business activities (approximately 321 million persons nationally). The 321 million figure is the base figure from which they have done about over a million households and 96,088 in depth interviews. Data Source for this presentation This presentation is drawn from the data of the Invest India Incomes and Savings Survey which was completed in June This is based on in-depth interviews with 1 lakh respondents aged yrs with cash incomes and supported by a household listing sample of 1 million. The figures projected refer to the 321 million paid work force of India in the presentation. Source: IIMS Data Works survey

32 Statutory Details: Sponsor: Reliance Capital Limited Trustee: Reliance Capital Trustee Co. Limited Investment Manager: Reliance Capital Asset Management Limited. The Sponsor, the Trustee and the Investment Manager are incorporated under the Companies Act Free life insurance cover provided as a part of an add on feature called as ‘Reliance SIP Insure’ arranged and funded by Reliance Capital Asset Management Limited through “Reliance Group Term Insurance Scheme” of Reliance Life Insurance Company Limited for insuring the outstanding SIP Insure installments. Subject to Conditions Risk Factors: Reliance Growth Fund (Open-ended Equity Growth Scheme): The primary investment objective of the scheme is to achieve long term growth of capital by investing in equity and equity related securities through a research based investment approach. Reliance Vision Fund (Open-ended Equity Growth Scheme): The primary investment objective of the scheme is to achieve long-term growth of capital by investment in equity and equity related securities through a research based investment approach. Reliance Equity Opportunities Fund (Open-ended Diversified Equity Scheme): The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio constituted of equity securities & equity related securities and the secondary objective is to generate consistent returns by investing in debt and money market securities. Reliance Equity Fund (An open-ended Diversified Equity Scheme): The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio constituted of equity & equity related securities of top 100 companies by market capitalization & of companies which are available in the derivatives segment from time to time and the secondary objective is to generate consistent returns by investing in debt and money market securities. Reliance Equity Advantage Fund (Open ended Diversified Equity Scheme): The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio predominately of equity & equity related instruments with investments generally in S & P CNX Nifty stocks and the secondary objective is to generate consistent returns by investing in debt and money market securities. Reliance Regular Savings Fund (An open ended Scheme) Equity Option: The primary investment objective of this Option is to seek capital appreciation and/or to generate consistent returns by actively investing in equity / equity related securities. Balanced Option: The primary investment objective of this Option is to generate consistent return by investing a major portion in debt & money market securities & a small portion in equity & equity related instruments. Reliance Pharma Fund (Open-ended Pharma Sector Scheme): The primary investment objective of the scheme is to seek to generate continuous returns by investing in equity and equity related or fixed income securities of Pharma and other associated companies. Reliance Diversified Power Sector Fund (Open-ended Power Sector Scheme): The primary investment objective of the scheme is to seek to generate continuous returns by actively investing in equity and equity related or fixed income securities of Power and other associated companies. Reliance Media & Entertainment Fund (Open-ended Media & Entertainment Sector Scheme): The primary investment objective of the scheme is to generate continuous returns by investing in equity and equity related or fixed income securities of Media & Entertainment and other associated companies. Reliance Banking Fund (Open-ended Banking Sector Scheme): The primary investment objective of the scheme is to generate continuous returns by actively investing in equity and equity related or fixed income securities of Banks. Mutual Funds and securities investments are subject to market risks and there is no assurance and no guarantee that the Schemes objectives will be achieved. As with investments in any securities, the NAVs of the units issued under the Scheme can go up or down depending on the factors and forces affecting the securities market. Past performance of the Sponsor/AMC/Mutual Fund is not indicative of future performance of the Scheme. Reliance Growth Fund, Reliance Vision Fund, Reliance Equity Opportunities Fund, Reliance Equity Fund, Reliance Equity Advantage Fund and Reliance Regular Savings Fund are only the names of the scheme and do not in any manner indicate either the quality of the Scheme, its future prospects or returns. The Sponsor is not responsible or liable for any loss resulting from the operation of the Schemes beyond their initial contribution of Rs.1 lac towards the setting up of the Mutual Fund and such other accretions and additions to the corpus. The NAV of the Schemes may be affected, interalia, by changes in the market conditions, interest rates, trading volumes, settlement periods and transfer procedures. The Mutual Fund is not guaranteeing or assuring any dividends/ bonus. The Mutual Fund is also not assuring that it will make periodical dividend/ bonus distributions, though it has every intention of doing so. All dividend/ bonus distributions are subject to the availability of distributable surplus in the respective Scheme. For details of scheme features and scheme specific risk factors please refer to the scheme Offer Documents. Offer Document and KIM cum application form is available at all the DISCs/ Distributors of RMF/www.reliancemutual.com. Please read the offer document of the respective scheme carefully before investing.

33 A Reliance Capital company Thanks for your time


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