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Prudent Corporate Advisory Services — Axis Mutual Fund — Debt Investor Presentation (August 2011)
13 slides from Prudent Corporate Advisory Services's debt investor presentation, August 2011
Slide 1: Axis Hybrid Fund – Series 2
Axis Hybrid Fund – Series 2 Equity participation with stability of fixed income 1
Slide 2: 3 reasons to invest in Axis Hybrid Fund – Series 2
3 reasons to invest in Axis Hybrid Fund – Series 2 The investment objective of the fund is to generate income by investing in high quality fixed income securities along with capital appreciation through investments in equity & equity related instruments. Offers an attractive route to take equity all
Slide 3: Equities are usually the best long term bet
Equities are usually the best long term bet For long term growth & protection against inflation, equity has been very consistent. High, Low and Average rolling 3‐Year returns is for the period 30th June 2001 to 30th June 2011. Equity is taken as BSE Sensex. Returns are compounded annualized. Fixed D
Slide 4: Periods of underperformance followed by superior returns
Periods of underperformance followed by superior returns When BSE Sensex has performed below 10% over 3 years, what happens to the equity markets in the next 3 years? 3 Years Ended Sensex Returns (% p.a.) Returns in subsequent 3 years (% p.a.) 31‐Mar‐88 4.03% 43.12% 31‐Mar‐89 7.52% 81.76% 31‐Mar‐95
Slide 5: But equity markets tend to be volatile
But equity markets tend to be volatile What is the risk of negative returns from equities over a 3 year holding period? Answer: Historically about 1 in 5 times Period: 30th June 2001 to 30th June 2011 Rolling 3 year BSE Sensex returns (% p.a.) Average Returns 16.0% Maximum Return 62.3% Minimum Retur
Slide 6: What is an Option Strategy? How does it work?
What is an Option Strategy? How does it work? When you buy a call option, you purchase the right to buy the Index at a specified future date and specified price. Advantage options: In case of positive returns, it delivers returns in line with markets In case of negative returns the option payoff is
Slide 7: Equity v/s Option payoff
Equity v/s Option payoff Option premium is the cost of implementing the strategy. The above table is only for illustration purposes, purely to explain the concept of the option strategy and should not be taken as any indication of either capital protection or equity market returns. The actual alloca
Slide 8: Why do an Option Strategy?
Why do an Option Strategy? Buying call options gives the right without the obligation to buy the index at a future date and a specified price. Direct equity investments will have a higher volatility/ downside risk compared to exposure through call options. The option premium paid will be the cost of
Slide 9: Introducing Axis Hybrid Fund – Series 2
Introducing Axis Hybrid Fund – Series 2 A blend of equity returns with stability To generate income by investing in high quality fixed income securities Investment Objective along with capital appreciation through investments in equity & equity related instruments. ‐ Allocated to equity & equity rel
Slide 10: Key Features
Key Features Type of Scheme A 3 year close ended income scheme Tenure 3 years from the date of allotment including the date of allotment Benchmark Crisil MIP Blended Fund Index Asset Allocation Debt and money market instruments – 65% ‐ 95% Equity and Equity Related instruments – 5% ‐ 35% Fund Manage
Slide 11: Disclosures & Statutory Details
Disclosures & Statutory Details: Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trusts Act, 1882, sponsored by Axis Bank Ltd. (liability restricted to Rs. 1 Lakh). Trustee: Axis Mutual Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC
Slide 12: Axis Mutual Fund
A AXIS MUTUAL FUND ™ 2) a yy Ee x iS Y
Slide 13: Option Strategy: Illustration
Option Strategy: Illustration Effective Notional Value Price Implied Volatility (%) Call Option Price (%) (%) 19 16 20 95 19 18 21 90 19 20 22 86 19 22 23 83 19 24 24 79 The option price depends on the implied volatility in the option contract For current range of market volatility, effective notion
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