MMS to be open-ended

MUMBAI, December 15: SBI Mutual Fund will convert its largest scheme, Magnum Multiplier Scheme 1990 (MMS 90), into an open ended one from J...

MUMBAI, December 15: SBI Mutual Fund will convert its largest scheme, Magnum Multiplier Scheme 1990 (MMS 90), into an open ended one from January 1, 1998. The scheme which was launched in January 1991 had been originally scheduled for redemption on December 31, 1997.

Though the scheme is going open-ended, it will be open for investment only to the existing investors for the period from Janaury 1- February 1. There are currently four lakh investors in the scheme whose corpus now stands at Rs 172 crore. Interestingly, however, the fund will be launching a special initial offering for fresh investors into the scheme from February 2.

However, investors in the scheme will not be given fresh unit certificates once the scheme goes open-ended. Instead, they will just be given a statement of accounts attached to which will be a withdrawal slip for redemptions and a request slip for fresh purchases.

K Ramachandran, chief manager marketing of the fund said that this system has been taken well by investors of the Magnum Open Fund. According to Ramachandran, the reason for going open-ended is that it will give investors a chance for a better NAV if the scheme is redeemed later than December 31. According to an internal study by the fund, conducted for the past three years, the index tends to peak in the period May-June.