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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 1000 p.m can get you…. A dinner for your family Watching movie with your spouse Buy clothes for your kids 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 ,00,00011,0006,0001, ,00,00022,00011,2003,6001,500 25,00,00055,00028,0009,0003,700 50,00,0001,10,00056,00018,0007, ,00,0002,20,0001,15,00036,00014,800 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 15% p.a. Investing Rs 1500 per 15% 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 Sensex12.64%18.99%15.30% BSE %20.33%16.48% Reliance Growth Fund-Retail Plan- Growth Plan – Growth Option* (RGF) 33.01%38.31%34.75% Rs 10,000 invested every year for a period of 12 years in RGF from Jan 96 to June 08 Past Performance may or may not be sustained in future. *Returns as on 30 th June 08

13 Past Performance of SIP in Reliance Growth Fund RGF BSE 100 Inception Date: 8th Oct Returns are of Retail Plan- Growth Plan – Growth option as on 30th June 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 10,000 p.m in the above fund since inception on 8 th Oct 1995 would have invested Rs lacs by 30 th June 08 and have earned a total amount of Rs 1.81 crs (As per the highlighted cell) SIP Installment /Yrs3510Since Inception 1,000 43, , ,707 1,811,655 40,056 98, , ,893 3, , ,914 2,834,120 5,434, , ,202 1,021,974 1,466,680 5, , ,524 4,723,534 9,058, , ,670 1,703,289 2,444,467 10, ,102 1,353,048 9,447,067 18,116, , ,340 3,406,579 4,888,933 15, ,153 2,029,572 14,170,601 27,174, ,847 1,481,010 5,109,868 7,333,400

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 the demise of an investor during the tenure of the SIP, the insurance cover will take care of the unpaid installments. Thus, the nominee* would be able to continue in the scheme without having to make any further contribution. Investor’s long term financial planning and objective of investing through SIP could still be fulfilled as per the targeted time horizon, even if he/she dies prematurely. 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.1000 per month. (Except for Reliance Tax Saver (ELSS) Fund where it is Rs 1000 p.m and in multiples of Rs 500 thereafter). There is no upper limit.  Minimum Period of Contribution : 3 years and in multiples of 1 month 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 The Life Insurance Cover under ‘SIP Insure’ facility will be revised as per the following clauses;  In the event of death of unit holder within the 1 st two years of the commencement of the insurance cover: An amount equivalent to the aggregate balance of unpaid SIP instalments, subject to a maximum of Rs.10 lakhs per investor across all schemes / plans and folios.  In the event of death of the unit holder after completion of 2 years (i.e. w.e.f. commencement of 3rd year onwards): An amount equivalent to two times the targeted SIP contribution (committed at the time of registration) i.e. Number of SIP Instalments enrolled for X Amount of Instalment X 2, subject to a maximum of Rs.10 lakhs per investor across all schemes / plans and folios. Thus, the amount of free life insurance cover could go upto 360 times of the monthly SIP installment depending upon the enrolled SIP tenure. Reliance SIP Insure – Product Features

23 The Life Insurance amount will be invested in the Nominee’s account, in the same scheme* 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. * Not applicable for Reliance Tax Saver (ELSS) Fund. For Reliance Tax Saver (ELSS) Fund;  Investors are requested to note that there will be a lock - in period of 3 years for each SIP Insure installment under ‘Reliance Tax Saver (ELSS) Fund’ as per the Government Notification of 2005 and in the event of demise of the unitholder, the nominee would be able to withdraw the investment amount only after the completion of one year from the date of allotment of the units or anytime thereafter without any exit load.  The insurance amount as per the above clauses a) and b) (as per earlier slide) subject to a maximum of Rs. 10 lakhs in a lumpsum in cash will be paid to the nominee in case of death of the unitholder (unlike other schemes, wherein the insurance amount will be compulsorily invested in the respective scheme and the nominee is allotted the units.) Reliance SIP Insure – Product Features

24 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. 5,000 for 5 years in Reliance Growth Fund If he dies after a period of 3 yrs, then his Sum Assured= Number of SIP Instalments enrolled for X Amount of Instalment X 2 = 60 X 5,000 X 2 = Rs 3 lacs X 2 = Rs 6,00,000 *Nominee account would mean nominee in case of single holding & second or joint holder in case of Joint Holding

25 Reliance SIP Insure – Product Features One can aim to have a target insurance cover from 3 rd year onwards 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 from third year onwards (from commencement of the insurance cover) in Reliance SIP Insure Facility, one can invest Rs 2800 p.m for a period of 15 yrs as per the cell highlighted in pink. Life Insurance Cover/Yrs ,000,000 13,900 8,350 4,500 2, ,000 12,500 7,500 3,750 2, ,000 11,150 6,700 3,350 2, ,000 9,750 5,850 2,950 1, ,000 8,350 5,000 2,500 1, ,000 7,000 4,200 2,100 1, ,000 5,600 3,350 1,700 1, ,000 4,200 2,500 1, ,000 2,800 1, ,000 1,

26  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

27 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- Retail Plan  Reliance Pharma Fund  Reliance Media & Entertainment Fund  Reliance Diversified Power Sector Fund – Retail Plan  Reliance Natural Resources Fund- Retail Plan  Reliance Quant Plus Fund – Retail Plan  Reliance Tax Saver (ELSS) Fund Reliance SIP Insure – Product Features

28 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

29 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

30 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

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 Sponsor: Reliance Capital Limited Trustee: Reliance Capital Trustee Co. Limited. Investment Manager: Reliance Capital Asset Management Limited. Statutory Details: The Sponsor, the Trustee and the Investment Manager are incorporated under the Companies Act 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. Reliance Natural Resources Fund (An Open Ended Equity Scheme): The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in companies principally engaged in the discovery, development, production, or distribution of natural resources and the secondary objective is to generate consistent returns by investing in debt and money market securities. Reliance Tax Saver (ELSS) Fund (Open-ended Equity Linked Savings Scheme): The primary objective of the scheme is to generate long-term capital appreciation from a portfolio that is invested predominantly in equity and equity related instruments. Reliance Quant Plus Fund (An open - ended equity scheme): The investment objective of the Scheme is to generate capital appreciation through investment in equity and equity related instruments. The Scheme will seek to generate capital appreciation by investing in an active portfolio of stocks selected from S & P CNX Nifty on the basis of a mathematical mode. 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, Reliance Regular Savings Fund, Reliance Banking Fund, Reliance Pharma Fund, Reliance Media & Entertainment Fund, Reliance Diversified Power Sector Fund, Reliance Natural Resources Fund, Reliance Tax Saver (ELSS) Fund and Reliance Quant Plus 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 / Scheme Information Documents. Offer Document/Scheme Information Document and KIM cum application form is available at all the DISCs/ Distributors of RMF/www.reliancemutual.com. Please read the offer document(s) /Scheme Information Document(s) of the respective schemes carefully before investing.

33 A Reliance Capital company Thanks for your time


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