Sunday, May 3, 2009

ICICI Prudential Target Returns Fund Review & Analysis

So what is the lesson learnt from this stock market turmoil? That is the answer to why ICICI Mutual fund house has come out with the NFO or New Fund offer for the ICICI Prudential Target Returns Fund.

Now instead of getting into the hectic mumbo-jumbo, let me tell you straight. This is a new fund offer or NFO from ICICI and has a special facility that you can book your profits automatically once your investment reaches a certain pre-defined threshold.
Most of the problems with investing in stock markets or investing in mutual funds are caused by the fact that investors dont know when to book the profits. They believe that their stock investments will continue to grow forever. However, it is not true. Every now and then there comes a bear market and new things (pot-holes) are discovered which erode the investors capital completely. Ask an invesstor who has burnt himself by investing in Satyam Stock. Though Satyam is an extreme case, even bluechip stocks like ICICI Bank, Reliance, SBI, have fallen through the roof.
What is the solution to this problem?
The solution is not to be greedy and book your profits at pre-defined levels.
For e.g. before committing any money to any mutual fund, say you decide that you want to set your profit target at 20% levels. So once the profit of 20% is achieved, exit from that investment and transfer that money to a bank fixed deposit or savings account or bond, where your money is safe.

ICICI Prudential Target Returns Fund claims to do that for you automatically. This is how ICICI describes the working of their fund:

ICICI Prudential Target Returns Fund
As per the details available, ICICI Target Returns Fund has a facility by which investors can book profits automatically. In this fund, gains made above a certain trigger percentage get redeemed automatically from the fund and are switched to a fixed income fund, which is chosen beforehand. The investor can choose trigger percentages of 12, 20, 50 or 100. Whenever the gains since the initial investment or since the last trigger cross this percentage, the money gets switched.
Hence, they claim that your money will be secure at your desired levels and you will not have to worry about the market downturns.

Any tax benefit available for investing in ICICI Prudential Target Returns Fund?
No. There is no tax benefit available.

What are the NFO dates for ICICI Prudential Target Returns Fund
ICICI Prudential Target Returns Fund NFO is currently open and will close on 14 May 2009

----Posted by Investment n Trading Advisor

Contact Investor Cell @ 0-9818269396 or

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