Being True to Label

Updated on 21-10-2016

“Actions speak louder than words”, goes the old adage. Going by our motto of serving our investors with the highest standards of integrity, ethics, and transparency we realize the importance of constantly walking the talk while retaining the trust our investors placed in us.

And at Quantum AMC we have believed since our inception that integrity must be maintained not only in the peripheral services provided to investors, but it must start at the core of what we do; managing your investments. So to us integrity also translates to being “true to label”, ensuring each of our schemes accurately abide by the investments limits laid down in their Offer Documents.

We respect your choice

What if a fund does not stay true to label? Imagine that you are a middle-aged person whose financial advisor recommends you the following asset allocation pattern

Asset classSuggested allocation
Equity60%
Debt30%
Gold10%

So with his assistance you pick up 3 funds to invest – a diversified equity fund in which you put 60% of your savings, a bond fund along with FDs for 30% of your savings and a gold ETF for the remaining 10%. Now you feel at peace that you’ve got your investments sorted at once. You check the performance 3 months down the line, 6 months down the line and the funds seem to be delivering superb.

However after a year, to your surprise you find out that the equity fund manager is being cautious about the markets and has invested only 55% in equities and the rest is invested in debt securities. So the fund is not being true to label.

Should you be disappointed? After all isn’t the fund manager acting on his judgments and trying to protect capital when the markets seem headed for a fall? But then you made the choice of investing in the fund based on an asset allocation plan suiting your risk profile...

Being not true to label can happen in various ways. It could be that the fund deviates from the investment objective, investment pattern or asset allocation.

Not being true to label hurts investors because it disrupts one’s asset allocation. The fund manager’s actions may not be the best because in the long run, it may have paid to stay than exit those equities. Also there is the reinvestment risk. Which means we cannot know for sure whether he would be able to buy the equities he sold at good valuations later.

We will stay true to label

At Quantum we’d like to respect our investors’ choice and manage their investments the way we promised them – as per the scheme documents – without wavering. We will follow the committed portfolio allocation pattern, irrespective of market conditions.

In the space below we have provided an upfront disclosure on the portfolio allocation of Quantum Mutual Fund’s schemes, vis-à-vis the minimum allocation as per their offer documents. You can view monthly updates here.

Also included is the actual portfolio allocation of the equity schemes calculated as per Income Tax Act vis-à-vis the minimum allocation required by the Act. You can refer to it to know your tax liability on your investment in the schemes.

Investment allocation of Quantum Mutual Fund schemes:
As of 30th September 2016Major Asset Class investment by SchemeMinimum Allocation in major asset class as per Scheme Offer DocumentMarket value of investments of major asset class as on Month EndMinimum investment allocation in Equity Shares as per Income Tax ActInvestment market value of Equity Shares calculated applying methodology mentioned in Income Tax Act (*)
SCHEME NAME
QUANTUM LONG TERM EQUITY FUNDEquity Shares65.00%86.87%65.00%92.18%
QUANTUM TAX SAVING FUNDEquity Shares80.00%88.42%65.00%92.28%
QUANTUM INDEX FUNDEquity Shares90.00%99.91%65.00%99.61%
QUANTUM EQUITY FUND OF FUNDUnits of Mutual Fund Equity Schemes90.00%97.76%Not ApplicableNot Applicable
QUANTUM MULTI ASSET FUNDDynamic - Equity, Debt, Gold Mutual Fund Units(**)45.66% in DebtNot ApplicableNot Applicable
QUANTUM GOLD  FUNDPhysical Gold90.00%100.16%Not ApplicableNot Applicable
QUANTUM GOLD SAVINGS FUNDUnits of Quantum Gold Fund95.00%99.91%Not ApplicableNot Applicable
QUANTUM LIQUID FUNDMoney Market Instruments & Other short term debt instruments100.00%93.58%Not ApplicableNot Applicable
QUANTUM DYNAMIC BOND FUNDGovernment Bonds, PSU Bonds, Money Market Instruments & Other short term debt instruments100.00%73.60%Not ApplicableNot Applicable

Note 1 : (*) As per Section 115 T of the Income Tax Act  Equity oriented  funds are such funds where the investible funds are invested by way of equity shares in domestic companies to the extent of more than 65% of the total proceeds of such fund. Provided that the percentage of equity shareholding of  the fund shall be computed with reference to the annual averages of the monthly averages of the opening and closing figures.

Note 2 : (**) Multi Asset Fund Investment Allocation as per Scheme Offer Document

Asset wise classificationIndicative Allocations (% of total Assets)
MinimumMaximum
Units of Equity Schemes25.00%65.00%
Units of Debt / Money Market Schemes25.00%65.00%
Units of Gold10.00%20.00%
Money Market Instruments/Short term Corp Debt0.00%5.00%

Being True to the Quantum Philosophy

At Quantum, we believe in complete transparency with our investors - existing and potential, we will not push any funds to you, but will tell you the pros and the cons of investing in a fund with complete honesty.

We also believe that an investor needs to be empowered with adequate information before he/she decides to invest in a fund. To that end we believe that the investor has the right to know not only where the fund invests (which investors can know by perusing the factsheet) but also the expenses that each fund incurs.

Product Labeling

Name of the SchemeThis product is suitable for investors who are seeking*Riskometer
Quantum Long Term Equity Fund
(An Open-ended Equity Scheme)
• Long term capital appreciation and current income

• Investments in equity and equity related securities of companies in S&P BSE 200 index.

Investors understand that their principal will be at Moderately High Risk
Quantum Liquid Fund
(An Open- ended Liquid Scheme)
• Income over the short term

• Investments in debt / money market instruments.

Investors understand that their principal will be at Low risk
Quantum Gold Fund
(An Open-ended Exchange Traded Fund- Gold)
• Long term returns

• Investments in physical gold.

Investors understand that their principal will be at Moderately High Risk
Quantum Index Fund
(An Open- ended Exchange Traded Fund)
• Long term capital appreciation

• Investments in equity and equity related securities of companies in CNX Nifty Index.

Investors understand that their principal will be at Moderately High Risk
Quantum Tax Saving Fund
(An Open-ended Equity Linked Savings Scheme)
• Long term capital appreciation

• Investments in equity and equity related securities of companies in S&P BSE 200 index and to save tax u/s 80 C of the Income Tax Act. Investments in this product are subject to lock in period of 3 years.

Investors understand that their principal will be at Moderately High Risk
Quantum Equity Fund of Funds
(An Open-ended Equity Fund of Funds Scheme)
• Long term capital appreciation

• Investments in portfolio of open-ended diversified equity schemes of mutual funds registered with SEBI whose underlying investments are in equity and equity related securities of diversified companies.

Investors understand that their principal will be at Moderately High Risk
Quantum Gold Savings Fund
(An Open-ended Fund of Fund Scheme)
• Long term returns

• Investments in units of Quantum Gold Fund - Exchange Traded Fund whose underlying investments are in physical gold.

Investors understand that their principal will be at Moderately High Risk
Quantum Multi Asset Fund
(An Open-ended Fund of Funds Scheme)
• Long term capital appreciation and current income

• Investments in portfolio of schemes of Quantum Mutual Fund whose underlying investments of companies, debt and money market instruments and physical gold.

Investors understand that their principal will be at Moderately High Risk
Quantum Dynamic Bond Fund
(An Open-ended Debt Scheme with Defined Credit Exposure and Dynamic Maturity Profile)
• Regular income over short to medium term and capital appreciation

• Investment in Debt / Money Market Instruments / Government Securities.

Investors understand that their principal will be at Moderate Risk

* Investors should consult their financial advisers if in doubt about whether the product is suitable for them.


Risk Factors: Mutual fund investments are subject to market risks read all scheme related documents carefully.
Risk Factors and Disclaimer:-
Please visit - www.QuantumMF.com to read scheme specific risk factors. Investors in the Scheme(s) are not being offered a guaranteed or assured rate of return and there can be no assurance that the schemes objective will be achieved and the NAV of the scheme(s) may go up and down depending upon the factors and forces affecting securities market. Investment in mutual fund units involves investment risk such as trading volumes, settlement risk, liquidity risk, default risk including possible loss of capital. Past performance of the sponsor / AMC / Mutual Fund does not indicate the future performance of the Scheme(s). Statutory Details: Quantum Mutual Fund (the Fund) has been constituted as a Trust under the Indian Trusts Act, 1882. Sponsor: Quantum Advisors Private Limited. (liability of Sponsor limited to Rs. 1,00,000/-) Trustee: Quantum Trustee Company Private Limited Investment Manager: Quantum Asset Management Company Private Limited. The Sponsor, Trustee and Investment Manager are incorporated under the Companies Act, 1956.
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Mutual Fund investments are subject to market risks, read all scheme related documents carefully.