r2i forum

Hi,
I am researching a few funds my parents have invested in recently, including:

1. Tata Tax Saving Fund
2. UTI-Long Term Advantage Fund Series II-Growth
3. BSL Tax Relief Fund-Growth
4. SBI Magnum Tax Gain
5. ICICI Pru Tax Plan
6. HDFC Top 200 Fund-Growth
7. UTI Opportunities Fund-Growth
8. SBI-Magnum Tax Gain Scheme

It seems all of them charge 2.5% for up to 1st 100 crore of fund, followed by a gradually reduced fee at higher intervals. Is it due to any govt. mandate? Also, if all of them have similar fee structure, is their return performance the only criteria to compare them?

Thanks,

The expenses you mentioned here are the maximum expenses allowed by SEBI and it is graduated based on fund asset size.

However each of these mutual funds charge different annual expenses. Check Moneycontrol.com or valueresearchonline.com to find out more about the fund expenses and performances.

Thanks for replying. I did see the actual charge number for some of these funds. So, is it fair to say that history of their 'real annual charge' and return is a good metric of their performance?

There are several factors for consideration.

I dont think annual fee is one of the top item. The difference is negligible between funds. It may seem big for US eyes which got used to number starting with "0.".

Indian managers are known for style drift, giving fancy names for funds which has same holdings. A growth fund may be a value fund. An infrastructure fund may hold pharma stocks. ( Hey, dont you need medicine for construction workers ? ) Technology fund may hold Indian bank stock. ( They have computers, dont they ?)

Go for risk adjusted return measurement. VRO rating does a good job of measuring that. I dont like the way they classify funds. I think they need to improve on that. But if you are beginner and looking for good funds, use their * ratings.