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If the maximum allocation is 35% in equity even in the cheaper market, how will this product provide equity tax benefit in terms of dividend distribution and capital gains?
Plan to have Monthly Dividend option . It will be a win win proposition , as the retirees will get Tax free Dividend , with yields better than Tax Free Bonds and Pension fund yields which is taxable.
Most Retirees in India throughout their working life have made no or little investments in equity related products. During their retirement phase an exposure to a balanced or a hybrid investment with a tax break thrown in looks good on paper. But, their inability to cope up with volatility of these funds is always a challenge for financial planners. A fund like this one from J P Morgan which addresses all the three issues, can increase the limited basket of investments that a retiree can invest in. I urge the industry to come out with innovative products that addresses the specific needs of the investors rather than go a on binge of NFOs simply to increase their AUM.
Something new; something attractive; something as usual let us make a trial with small portion