GOOD ARTICLE , WISH SEBI SHOULD READ IT.

Mr. Mendes can very well afford to be poetic and philosophical (with AUM of 90 Crores). Clearly you sound more like the regulator. Big Words have impact and create impression only when the readers can connect them to intention of the writer. As someone nicely said "words are mere servant of Thought"

I appreciate the thinking pattern, command over the language. Not everyone will have this gift - (l)earned one, isn't it ? But it would have certainly reached many, had this been more simple. Rather than looking at the message, everyone is talking of the text. This itself is ample proof that these kind of communications have to be simpler, with due respects to the Prof.

I appreciate the thinking pattern, command over the language. Not everyone will have this gift - (l)earned one, isn't it ? But it would have certainly reached many, had this been more simple. Rather than looking at the message, everyone is talking of the text. This itself is ample proof that these kind of communications have to be simpler, with due respects to the Prof.

Erudite person. The text could have been written in simple English, for better understanding by lesser mortal like me.

Brilliant!

Flowery speech apart, the professor really did not mince words about what SEBI ought to consider now. But in future, have pity on us lesser mortals and do not make us scurry for our dictionaries when we read your articles! As vasudevan put it rather bluntly, the main idea of communication is to reach across. At the same time, I cannot go without saluting the professor's flair for using ethereal words for explaining seemingly simple concepts!

Every one will agree that the article is a good literary work, but to what extend it is understood and benefited by I F A communty including myself is doubtful. However such an educative effort is really appreciated.

I agree with mr.Mendes that sebi should take care of all stakeholders & should takes effective steps to grow the mf industry.

this article message should sent to SEBI through IFA FORUM,like MFRT ,WEALTH FORUM & OTHERS.We r the pillore of MF,All AUM EARLIER has been created by us not by AMC or SEBI OR AMFI.It is our colletive effort of IFAS since 1971(UTI).SO govt. should interfear in this matter soon to protet the interest of IFA & investors.

A GOOD ARTICLE

Amidst listening to what Shelley, Shakespeare, Buffet, Nani Palikiwala, Lord Keyenes said and those, hand-picked rich vocabulary, I missed out on Prof Mathew's point. I read it somewhere " If you can't explain it in simple term, you have not understood it properly" Let's keep it simple, not many IFAs are PHDs.

Investors,mutual funds and distributors are the three pillars of the mutual fund industry.Distributors provide the last mile connectivity to the investors and know his psyche more than anybody else. unfortunately neither the mutual fund industry represented by AMFI appreciate the stellar role played by the IFAS in spreading the message of mutual funds and bringing sticky long term money nor the regulator is aware of the problems faced by these foot soldiers.It is this unfortunate situation which has put the industry in the oxygen tent gasping for breath.Policymakers speak tirelessly of financial inclusion while their policy making ensures financial exclusion.Time has come now for the Government to step in and stem the rot to enable mutual fund industry to play its role in capital formation and also help neutralise dwindling foreign inflows.I commend Mr.Mendis for his thoughtful exposition.

well said Prof.but this massage must reach to SEBI who is not taking any step to revive their own mistake.

Prof Mendes has hit the nail on it's head when he questions the role of SEBI as strangulator rather than regulator. I was quite impressed both with his views on SIPs, SEBI's role, etc as much as his way of writing ( interspersed with a lot of words of wisdom by some of the Greats). Would love to interact with him and exchange views of mutual interests

Prof Mendes at his best.i fully concur with his views. If SEBI is bothered only about the investor which i am not convinced it is then we should have a separate regulator for MFs and capital markets.SEBI took a micro view and ought to correct and take a macro view.

Well said and written.

An excellent article written by an excellent author who really gone through the pain and agony of the entire IFA community.But the sorryful thing is that the authorty like SEBI should read this kind of article while taking any kind of regulatory cganges in the MF industry and instead of working like only as regulatory body they shold work towards nurturing and devloping the MF industry by taking care all the three stakeholders.

It takes courage to admit a mistake and common sense to rectify itbut . . . the current impasse may well turn out to be an exception which proves the rule.

SEBI, if it really wants to protect investor interest should really be going after unscrupulous experts who appear in almost every newspaper and T.V. Channel giving advice to investors and dishing out ratings to Funds. These people have nothing at stake and I really wonder as to how many of them are AMFI Cerified. This becomes relevant particularly because SEBI wants investors to invest directly without any intermediaries. If we as IFA's have to have AMFI Certification to give such advice then why should not these so called experts, who really keep changing their ratings month on month?

The role of small distributors for small towns and villages is always ignored. But his importance is not less than the small investors who put in Rs 5000/-. Its time authorities take a note of it and take steps to keep their business viable, then only will their be continous inflows in the mf industry.

We don’t care when hoards of small advisors/distributors are leaving, but when there is a threat to the profit of big distributors by cutting out up-front commissions, the whole operating mechanism moves in the pretext of helping small distributors/advisors, though almost all of us knew fully well that it is the increased trail that helps the small advisors and investors in the longer run. It indeed is a time to be a bit more honest and clear the clouds for small advisors/distributors about how the business model is going to be like, with reasonable certainty. The increase in expense ratio and proposed fungibility may become a tool to make more profits for the fund houses, unless how much of it will be allocated towards the sustenance of small advisors/distributors and for the growth of the industry is clearly defined.

If these columnists think that a killing is made in mutual fund advisory by small advisors/distributors, why don’t they try to make profit by joining this advisory business rather than doing paltry paying (is it?) columnist jobs ? Sadly, the small advisor is always the favorite whipping boy for everyone as he doesn’t have a voice, as he doesn’t even whine-whatever the treatment that one meets him out and however disdainfully one treats him. After all he doesn’t matter, does he? The truth is we don’t have the courage to write about the short comings of the big boys, whether it is the fund houses, big distributors, R & Ts etc., Whenever we want to divert attention from our own short comings, we choose our favorite whipping boy, the small advisor/distributor and beat him up to the extent that everyone believes that he is the main culprit for all the mess in Mutual Fund industry.

It indeed is the time to take a balanced view. It indeed is the time to acknowledge the importance of small advisors/distributors in the growth of this industry and pay them well. It hurts me to see some of the news reports, which project, what havoc a 0.25% increase in expense ratio could cause to the long term returns of the investors. The projection is as if all the advisors/distributors are making crores of rupees out of this business and are still trying to increase their profits. Reports prominently published highlighting the hundreds of crores of profit being made by the “top distributors”, time and again, strengthens this projection. The very newspapers bring in articles to justify around 8-10% commissions in ULIPs in some or other garb and advertise money back policies on their front pages knowing fully well the approximately 40% commissions involved in there.

Dear Professor, Excellent English Professor. Thanks for the literary treat. Coming to the subject, the real gamechangers are the AMC's. You can see the big fat AMC's increasing profits despite all these changes. If they really wish they will change the rules of the game. The current rules of the game are to the AMC's advantage. And the game will continue, whatever we think or feel about it. When those biggies [AMC's] feel the need to bring in change, they would execute it in style.

Quite a poetic treatise by Professor M Mendes.Hope there are people out there(or shall we say UP there)who appreciate the literary effort and take a cue.....

As I have mentioned before on this forum, besides bringing back entry loads (it will not make a difference now whether SEBI admits or not it was a monumental blunder to abolish entry loads in a nascent industry), there are two important things needed to revive the Indian Mutual Fund industry : 1. Increase penetration to untapped markets & 2. Increase mobilisation from existing investors Both above can surely be achieved by retaining the eligibility status of ELSS MFs under Section 80C of the Income Tax Act AND increasing the limit from the present Rs.1 lakh to at least Rs.3 lakhs. I say this with a lot of confidence because the typical Indian Investor mindset is geared to "incentives" : if there is an incentive to invest in the form of a tax benefit, s/he will jump at the opportunity because saving tax is paramount for salaried as well as business persons. _____________________________________________________________________

As I have mentioned before on this forum, besides bringing back entry loads (it will not make a difference now whether SEBI admits or not it was a monumental blunder to abolish entry loads in a nascent industry), there are two important things needed to revive the Indian Mutual Fund industry : 1. Increase penetration to untapped markets & 2. Increase mobilisation from existing investors Both above can surely be achieved by retaining the eligibility status of ELSS MFs under Section 80C of the Income Tax Act AND increasing the limit from the present Rs.1 lakh to at least Rs.3 lakhs. I say this with a lot of confidence because the typical Indian Investor mindset is geared to "incentives" : if there is an incentive to invest in the form of a tax benefit, s/he will jump at the opportunity because saving tax is paramount for salaried as well as business persons.

Bella Figura ! Cest La Viest !