Canbank Mutual Fund has converted its Canpremium Scheme into an open-end fund. The rolled over Canpremium is a conservative balanced fund. Earlier, Canpremium was an income fund which promised a minimum growth rate of 12.5 per cent during its five-year tenure. The rolled over Canpremium seeks current income and long-term capital growth with the portfolio leveraged towards debt. The fund will have up to 60 per cent exposure to fixed income securities and up to 40 per cent to equities.

Canbank Mutual Fund already has an open-end balanced fund, Canganga. Unlike Canpremium, Canganga has an aggressive equity exposure. Canganga aims to invest between 60-80 per cent in equities and around 20-30 per cent in debt.

Canpremium was rolled over on February 1, 1998 and is available for continuous sale and repurchase from April 20, 1998. The latest NAV of the scheme is 10.42. Canpremium is available on a no-load basis till July 20, 1998. Thereafter, the AMC plans to introduce an entryload (not exceeding 5 per cent). Repurchase is at NAV. At present, the Rs 52-crore fund has an equity exposure in 13 stocks which amount to less than 10 per cent of the net assets. Debentures (valued at cost) account for around 15 per cent of the holdings and have a weighted average coupon rate of 14.30 per cent. Besides, the fund has a whooping 59 per cent (Rs 30.64 crore) in 17 per cent MTNL paper. The balance 6 crore is CDs from Bank of America and ICICI.

Opportunity in balanced funds

For investors who have burnt their fingers in equity funds, balanced fund like Alliance '95, JM Balanced, Tata Twin Option Fund, Chola Freedom, Canganga and Canpremium could be an appropriate way to re-enter the equity markets.

These funds are also especially appropriate for individual who are just starting out and want to invest only in one instrument, since they are diversified into both debt and equity. Canpremium perhaps would be the first balanced fund to have a conservative equity exposure and could beespecially appropriate for investors with a reasonably conservative orientation and yet want to have some kind of an exposure in equities.

KPMF's income fund to open on Apr 29

Kothari Pioneer Mutual Fund is launching two funds in April 1998. Children Asset Plan launched on April 22, will remain open till June 5. The scheme is aimed at investors plan their child's future. The scheme aims to generate steady returns with high safety of capital by investing a minimum of 90 per cent of corpus in debt and money market instruments. Based on the current market expectation, the AMC hopes to provide an annual return of between 13-14 per cent. Redemption and repurchase will be at the prevailing net asset value

The scheme is available in two flavours. Under the gift plan, the investors can make an irrevocable gift to the child which matures on the child attaining the age of 18. An account can be opened for a minimum of Rs 2000 for children below 14 years. The fund has two plans -- dividend and capitalappreciation. The Education Plan is designed to help parents meet the regular expenses of their ward's education. The investment will have a lock in of four years. On the child attaining 18 years, the corpus can be transferred to the child or retained by the investor.

Kothari Pioneer Mutual Fund is also launching its short-term open end income fund on April 29, 1998. KP Treasury Management Account is a no load fund and will invest its corpus in fixed income and money market instruments. The fund aims to provide reasonable returns with high liquidity. Similar schemes have been able to provide a return of around 9-10 per cent in the past.

GIC converts growth fund into open-end

GIC Mutual Fund has converted its GIC Growth Plus-II into an open-end fund. The fund is available for continuous sale and repurchase from April 23, 1998. Fresh entry will carry a 3 per cent sales charge, while redemption will at a 3 per cent discount to the net asset value. GIC Mutual Fund already has an open-end growthfund, GIC Fortune '94. GIC Growth Plus-II seeks long term capital growth through a high quality growth oriented equity portfolio. The fund normally aims to have around 80 per cent exposure in equities, 10 per cent in fixed income securities and balance in money market instruments. As on March 31, 1998, the fund had a 88 per cent exposure in equities.

With its corpus of around Rs 189 crore, Growth Plus II will be one of the largest open end equity fund. Growth Plus II has appreciated by an annual rate of 0.87 per cent since its launch in February 1994. Its performance in the recent past has been better. In 1997-98, the fund has appreciated by 6.80 per cent and in the first quarter of 1998, the fund has grown by 7.02 per cent.