The point is those who stay on get rewarded only when the exit load is actually credited into the fund and goes towards increasing the NAV.What if the money goes into the pocket of AMCs and not into the fund?

 

Devesh, Moneyline has reported that piece on IGF and Kirit Somaiya blowing the whistle. Infact personalfn.com has written a story about it when this malpractice gained momentum. This happend when SEBI put a cap on the entry load at 2.25%. AMCs had to find new ways to handle their rising distribution and advertising costs.

 

You will find this article interesting

 

http://www.personalfn.com/detail.asp?date=5/29/2007&story=2 - "Exit Loads are just a con job"

 

Personalfn and Quantum AMC have always been championing the cause of low cost which has been flaunted by most other AMCs. I must make a mention here that i work with Quantum and would be glad to share more information about Direct selling, low cost model of Mutual funds.

 

 

In war, no one would recommend to optimize number of bullets against dead-body of enemy. We will not want to kill 2 enemy by single bullet in 30 minutes. All wants to kill as many enemy as one can in shortest period of time.

Similarly, we all want most of returns in shortest period of time. We don't care of ""loads"".

In war, no one would recommend to optimize number of bullets against dead-body of enemy. We will not want to kill 2 enemy by single bullet in 30 minutes. All wants to kill as many enemy as one can in shortest period of time.

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Excellent thoughs. Are these own creation or borrowed from somewhere?

 

Without the distribution chain and aggresive advertising, the management had always known that the growth of our AuM will be relatively slow. Today the fund stands at about Rs. 65 crores. The number of investors is growing thanks to positive word of mouth and the press writing about us.

 

Quantum firmly believes in giving maximum value to the investor, even if they are few in number. About what the size of AuM finally means to the investor, here is an article by Ajit Dayal:

 

http://quantumamc.com/school/summit/summit.html - http://quantumamc.com/school/summit/summit.html

 

Answering your query about whether our management is worried about the slow growth and low AuM, you will find the answers in the interview of Ajit Dayal  and Devendra  Nevgi by Valueresearch online right here (incidentally the article is on the top of their homepage today!!):

 

http://www.valueresearchonline.com/story/mspeaks.asp?str=10173 - Making a difference

( http://www.valueresearchonline.com/story/mspeaks.asp?str=10173 - http://www.valueresearchonline.com/story/mspeaks.asp?str=10173 )

 

Quantum hasn't advertised since its NFO announcement, since its unfair to use the investor's money to get ten more with very little value for him in return. Quantum builds awareness by educating investors through articles and its monthly newsletter - Quantum Direct.

 

I would request you to have a look at a sample of the same in the link below:

 

http://www.quantumamc.com/schemes/QD%20-%20Jul07.pdf - http://www.quantumamc.com/schemes/QD%20-%20Jul07.pdf

 

 

Companies, like Vanguard in the US,  that have roots in ethical values have succeeded slowly but surely. Whether the ethics that we believe in stands in practice, or is a dikhaawa, the best people to tell would be our investors.

 

We do have tie up with banks for payments to our online investment gateway. But we do not use their resources for selling on commission basis.

At the end of the day these 2.25% loads should not matter because this means that any fund that is giving out returns to investors would have to outperform Quantum by only 2.25% for the investor to break even.

 

Any prudent investor would rather look at the NAV and the net returns rather then the process in which these returns are being generated. Also with a corpus of Rs 65 crores it would not be sensible for Quantum to advertise because the cost per unit would be very high!

 

I am quite sad to see, people giving such poor examples in public domain. If Ram & Shyam are mutual Funds. Ram's parents/teachers could be very very happy on Ram's performance but fact remains different..Shyam is ahead from Ram in that class. I don't know to what extends people go to explain why not so good is not 'not all that bad'.

http://www.theequitydesk.com/forum/member_profile.asp?PF=683&FID=21 - np1408 jee, Please don't take is personally, although I am often criticized for it. I think you are on duty.

 

 

If I remember correctly last June Quantam was in cash because it had just raised money from its NFO so wasn't the outperformance more by design then default. We can keep arguing on this but the answer will emerge only when the markets tank 20% again. Will you go 40% cash at the peak?