Reliance Mutual Fund R*Shares ETF offerings · Reliance Mutual Fund: ETF Offerings ... ITC LTD 6.76...

Reliance Mutual Fund –

R*Shares ETF offerings

November 2015

Confidential Slide

What is an Exchange Traded Fund (ETF)?

An ETF is a MF Scheme or security that endeavor to replicate the

value of an underlying i.e index or a commodity

2

Confidential Slide

ETFs are Mutual Fund schemes and listed & traded on the

exchange like stocks

An ETF represents a basket of stocks that reflect an index

An ETF helps you to achieve portfolio diversification, risk

management & cash equitization at a relatively low cost

About Exchange Traded Funds (ETFs)

Basket of asset instead

of a single stock

Can be traded like a

stock

Bought and sold on a

stock exchange

3

Confidential Slide

Advantages of Investing in Equity ETFs

ETFs are simple to understand and are transparent to track

Can be bought / sold like any other stock on the exchange (Where the scheme is listed ) through terminals

Generally less expensive than investing in multiple individual securities.

Can be bought / sold anytime during market hours real-time prices instead of end-of-day prices

4

Confidential Slide

Applications of ETFs in Various Strategies

#Subject to the market condition and availability of spread and liquidity.

• ETFs can be used for a given percentage of each asset class to provide a liquidity buffer across the asset allocation.#

Liquidity Management

• ETFs allow investors to gain exposure to an asset class that may be underrepresented in the asset allocation of investor’s portfolio.

Portfolio Completion

• ETFs assist in remaining fully invested while maintaining liquidity, thus minimizing the cash drag effect on the portfolio.

Cash Equitization

• Since ETFs are passive funds which may help to maintain market exposure while there are changes in sector/stock allocations in a portfolio, it avoids the risk of missing any market movement.

Portfolio Transitions

5

Confidential Slide

Exchange Traded Funds (ETFs)

Global and Indian Scenario

6

Confidential Slide 7

Globally ETFs have witnessed strong growth across

markets

Source: ETFGI, Nov 2015 Note: Past performance may or may not be sustained in the future.


Overview of Equity ETF market in India

Source: MFI

Note: The data in the above table excludes Gold ETFs and CPSE ETF & Debt ETF. Upon including the Gold

ETFs and CPSE ETF, the total corpus is Rs. 17,032 crs.

Reliance Share in ETF Market: 9.98% Note: Data as on Nov 30, 2015.

728

31315

702

3464

2776

403702

1976

1131 913 959

4856

8236

1 23 4 4

46

10

1216

18

21

22

30

37

0

5

10

15

20

25

30

35

40

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

Total Corpus (in Crs) Number of Schemes

Phase 1

FIIs restriction

Phase 2

No FIIs restriction


Working Mechanism of ETFs in India

Primary Market Secondary

Market

Authorized

Participants /

Financial Institutions Stock Exchange

Fund Buyer

Seller

Buy / Sell

Market making /

arbitrage

Cash ETF units

Cash ETF units Subscription /

redemption

in-kind


Equity

• Our equity offerings cater to all type of investors’ risk profile

• Investment style approach varies from conservative, moderate, aggressive to very aggressive

• Our products include :

• Market - Cap Based – Large Cap, Mid & Small Cap, Multi Cap

• Sector Focus – Banking, Power, Pharma, Media & Entertainment

• Theme Based – Infrastructure, Natural Resources (partly investing in overseas securities)

• Index Linked & Exchange Traded Funds

• Our portfolio comprises of well diversified , high quality fixed income papers which aims to deliver relatively stable returns

• Our products are present across the yield curve:

• Liquid – Nil mark to market component & low volatility

• Ultra–Short Term & Short Term - Short to medium term horizon with medium risk appetite

• Long Term - Credit specific & gilt funds

• Hybrid - Stability of Debt + Power of Equity

Fixed Income

Gold

• Gold portfolio consists of Exchange Traded Fund & Fund of Fund which enable to reap the returns of gold in non-physical

form in a relatively cost effective & convenient way

Our Product Portfol io

Confidential Slide

To be a significant player in the ETF segment

RCAM is committed towards increasing its number of products, AAUM and market share over the

next few years.

To offer a bouquet of ETFs including Generic, Thematic, Sector Specific

and Active ETFs.

RCAM is committed towards bringing out ETFs across various categories.

To focus on product innovation

RCAM is focused on innovating its product offerings and is exploring opportunities like Sector

ETFs, Commodity ETFs, Derivative ETFs, Style ETFs, Bond/Liquid ETFs, Inverse ETFs,

Leveraged ETFs, Synthetic ETFs.

To create a market through substantial education & awareness

As the Indian ETF market is at a nascent stage, RCAM is committed towards the growth of the

market by means of education and awareness.

11

RCAM Objective

Confidential Slide

R*Shares positioning: Having a foresight into the growth of the segment, at Reliance

Mutual Fund, the ETF offerings were re-branded as “R*Shares” to create a distinct identity

between passively managed listed products and actively managed offerings. R*Shares series

of ETFs give choice to the investors to participate in the equity markets at low cost as they are

generally less expensive than investing in multiple individual securities.

12

Reliance Mutual Fund: ETF Offerings

We presently offer 8 ETFs: Reliance Market Share: 9.98%

Source: MFI. Data as on Nov 30, 2015

• R*Shares Nifty ETF

• R*Shares Sensex ETF

• R*Shares Banking ETF

• R*Shares NV20 ETF

• R*Shares CNX 100 ETF

• R*Shares Consumption ETF

• R*Shares Dividend Opportunities ETF

• R*Shares Gold ETF

RCAM9.98% CPSE

12.09%

Other AMCs77.94%

Confidential Slide

R*Shares Nifty ETF

13

(An Open Ended Index Exchange Traded Fund)

[Rajiv Gandhi Equity Savings Scheme (RGESS) qualified scheme]


Investment Objective

The investment objective of the scheme is to provide investment returns that, before expenses, closely

correspond to the total returns of the securities as represented by the Nifty 50 index, subject to tracking

errors. However, there can be no assurance or guarantee that the investment objective of the Scheme

will be achieved.

About the Benchmark: Nifty 50 Index

The Nifty 50 is a well-diversified 50 stock index accurately reflecting overall market conditions. The

reward-to-risk ratio of Nifty 50 is higher than other leading indices, making it a more attractive portfolio

hence offering similar returns, but at lesser risk.

R*Shares Nifty ETF


R*Shares Nifty ETF

Top 10 Stocks Top 10 Sectors

Note: The sectors mentioned in the table is not a recommendation to buy/sell in the said sectors. The scheme currently holding investments in the said

sectors and may or may not have future position in the same. The stocks mentioned forms a part of the portfolio of the scheme and may or may not form a

part of the portfolio in future. Please read Scheme Information Document carefully for more details and risk factors. Source: RMF Website

Stock Allocation (%)

INFOSYS LTD 7.63

HDFC BANK LTD 7.49

ITC LTD 6.76

HDFC LTD 6.71

ICICI BANK LTD 5.61

RELIANCE INDUSTRIES LTD 5.60

TATA CONSULTANCY SERVICES LTD 4.28

TATA MOTORS LTD 2.88

SUN PHARMACEUTICALS INDUSTRIES LTD 2.79

Sector Allocation (%)

Banks 24.53

Software 16.05

Consumer Non Durables 10.11

Auto 9.58

Pharmaceuticals 6.84

Finance 6.71

Petroleum Products 6.42

Cement 2.83

Power 2.43


Key Fund Details

R*Shares Nifty ETF

Source: RMF Website, MFI

Note: Data as on November 30, 2015. Live Prices (NAV) with the basket is available on Bloomberg page

“RITE” for reference. Ratios on the basis of 1 year rolling period

Portfolio Characteristics

Beta: 0.99

Standard Deviation: 2.25

R Squared: 1

Sharpe Ratio: - 0.11

Index Characteristics

Index Level: 7935.25

Price/Earning: 21.45

Price/Book Value: 3.19

Dividend Yield: 1.43

Other Key Details

Creation Unit Size: 50,000

NAV per unit: Rs. 81.5641

Approximate Basket Value: Rs. 40.78 lacs

NSE/BSE Symbol: RELNIFTY

Bloomberg Ticker: RELNIFTY:IN

Expense: 0.08%

Total Return Tracking Error

( Dec 2014 to Nov 2015): 0.17%

Confidential Slide

R*Shares Sensex ETF

17





The investment objective of the scheme is to provide investment returns closely corresponding to the

total returns of the securities as represented by the S&P BSE Sensex Index before expenses, subject

to tracking errors. However, there can be no assurance or guarantee that the investment objective of

the Scheme will be achieved

About the Benchmark: S&P BSE Sensex Index

S&P BSE Sensex, first compiled in 1986, was calculated on a “Market Capitalization-Weighted”

methodology of 30 component stocks representing large, well-established and financially sound

companies across key sectors. S&P BSE Sensex today is widely reported in both domestic and

international markets.

R*Shares Sensex ETF


R*Shares Sensex ETF






INFOSYS LTD 9.38

HDFC BANK LTD 9.09

ITC LTD 8.31

HDFC LTD 8.28


ICICI BANK LTD 6.87





Banks 22.73

Software 16.17

Auto 11.69



Finance 8.28


Telecom - Services 2.02

Oil 1.82


Key Fund Details

R*Shares Sensex ETF

Source: RMF Website , MFI


“RITE” for reference . Ratios on the basis of 1 year rolling period


Beta: 0.99


R Squared: 0.99







Other Key Details




NSE/BSE Symbol: RELSENSEX

Bloomberg Ticker: RSENSEX:IN

Expense: 0.08%


( Dec 2014 to Nov 2015): 0.13%

Confidential Slide

R*Shares Banking ETF

21

(An open ended, exchange listed, index linked scheme)



The investment objective of the scheme is to provide returns that, before expenses, closely

correspond to the total returns of the securities as represented by the Nifty Bank Index. However, the

performance of Scheme may differ from that of the underlying index due to tracking error. There can

be no assurance or guarantee that the investment objective of the scheme will be achieved.

About the Benchmark: Nifty Bank Index

Nifty Bank Index is an index comprised of the most liquid and large capitalised Indian Banking stocks.

It provides investors and market intermediaries with a benchmark that captures the capital market

performance of Indian Banks.


Confidential Slide

Top 10 Stocks

23


Note: The stocks mentioned forms a part of the portfolio of the scheme and may or may not form a part of the portfolio in future. Please read Scheme

Information Document carefully for more details and risk factors. Source: RMF Website


HDFC BANK LTD 29.80

ICICI BANK LTD 22.32

AXIS BANK LTD 10.99

STATE BANK OF INDIA 10.82

KOTAK MAHINDRA BANK LTD 9.97

INDUSIND BANK LTD 6.36

YES BANK LTD 3.51

BANK OF BARODA 2.36

PUNJAB NATIONAL BANK 1.51

THE FEDERAL BANK LTD 1.41



Key Fund Details




Other Key Details

Creation Unit Size: 1000



NSE/BSE Symbol: RELBANK

Bloomberg Ticker: RBETF:IN

Expense: 0.20%


( Dec 2014 to Nov 2015): 0.12%


Beta: 1.38


R Squared: 0.77

Sharpe Ratio: 0.04






Confidential Slide

R*Shares NV20 ETF

25






correspond to the total returns of the securities as represented by the Nifty 50 value 20 Index, subject


the Scheme will be achieved.

About the Benchmark: Nifty 50 Value 20 Index

The Nifty 50 Value 20 Index is a diversified portfolio of value companies forming a part of Nifty 50

Index. It consists of the most liquid value blue chip companies. The Nifty 50 Value 20 comprises of 20

companies listed on the National Stock Exchange (NSE). Value companies are normally perceived as

companies with low PE (Price to Earning), low PB (Price to Book) and high DY (Dividend Yield).

R*Shares NV20 ETF


R*Shares NV20 ETF






INFOSYS LTD 14.32

ICICI BANK LTD 13.10



AXIS BANK LTD 6.45

STATE BANK OF INDIA 6.35

MAHINDRA & MAHINDRA LTD 5.18

HINDUSTAN UNILEVER LTD 4.71

HCL TECHNOLOGIES LTD 3.96

COAL INDIA LTD 3.49


Software 28.28

Banks 28.17


Auto 10.66


Minerals/Mining 4.10

Oil 3.45

Power 2.22

Gas 1.39

Ferrous Metals 1.26


Key Fund Details

R*Shares NV20 ETF



“RITE” for reference. Ratios on the basis of 1 year rolling period






Other Key Details




NSE/BSE Symbol: RELNV20

Bloomberg Ticker: RELNV20:IN

Expense: 0.35%

Confidential Slide

R*Shares CNX 100 ETF

29





The investment objective of the scheme is to provide investment returns that, before expenses,

closely correspond to the total returns of the securities as represented by the Nifty100 Index, subject


the Scheme will be achieved.

About the Benchmark: Nifty100 Index

Nifty 100 tracks the behavior of combined portfolio of two indices viz. Nifty 50 and Nifty Next 50. It is a

diversified 100 stock index accounting for 38 sectors of the economy.









INFOSYS LTD 6.29

HDFC BANK LTD 6.17

ITC LTD 5.57

HDFC LTD 5.54

ICICI BANK LTD 4.62



LARSEN & TOUBRO LTD 3.26




Banks 20.71

Software 13.47


Auto 8.88

Finance 8.71



Construction Project 3.26

Cement 2.33

Power 2.18


Key Fund Details


Source: RMF Website, MFI.



Other Key Details




NSE/BSE Symbol: RELCNX100

Bloomberg Ticker: RCNX100:IN

Expense: 1.50%


( Dec 2014 to Nov 2015): 0.17%



Price/Earning: 21.5




Beta: 0.99


R Squared: 0.99


Confidential Slide

R*Shares Consumption ETF

33





correspond to the total returns of the securities as represented by the Nifty India Consumption Index,

subject to tracking errors. However, there can be no assurance or guarantee that the investment

objective of the Scheme will be achieved.

About the Benchmark: Nifty India Consumption Index

The Nifty India Consumption Index is designed to reflect the behavior and performance of a diversified

portfolio of companies representing the domestic consumption sector which includes sectors like

Consumer Durables & Non-durables, Healthcare, Auto, Telecom Services, Pharmaceuticals, Hotels,

Media & Entertainment, etc. The Index comprises of 30 companies listed on the National Stock

Exchange (NSE).









ITC LTD 9.80

MAHINDRA & MAHINDRA LTD 9.62

MARUTI SUZUKI INDIA LTD 9.29


BHARTI AIRTEL LTD 7.04

ASIAN PAINTS LTD 5.79

BAJAJ AUTO LTD 5.15

HERO MOTOCORP LTD 5.02

ZEE ENTERTAINMENT ENTERPRISES LTD 3.40

AUROBINDO PHARMA LTD 3.32



Auto 29.07

Telecom - Services 10.61


Media & Entertainment 4.01

Consumer Durables 3.47

Power 2.78

Healthcare Services 1.53

Textile Products 1.08

Hotels, Resorts And Other Recreational Activities 0.72


Key Fund Details





Other Key Details




NSE/BSE Symbol: RELCONS

Bloomberg Ticker: RCONSUM:IN

Expense: 0.35%


( Dec 2014 to Nov 2015): 0.26%


Beta: 0.87


R Squared: 0.79

Sharpe Ratio: -0.01






Confidential Slide

R*Shares Dividend Opportunities ETF

37




The investment objective of the scheme is to provide investment returns that, before expenses,

closely correspond to the total returns of the securities as represented by the Nifty Dividend

Opportunities 50 Index, subject to tracking errors. However, there can be no assurance or guarantee

that the investment objective of the Scheme will be achieved.

About the Benchmark: Nifty Dividend Opportunities 50 Index

The Nifty Dividend Opportunities 50 Index is designed to provide exposure to high yielding companies

listed on NSE while meeting stability and tradability requirements. The Nifty Dividend Opportunities 50

Index comprises of 50 companies. The methodology employs a yield driven selection criteria that aims

to maximize yield while providing stability and tradability. Currently the index comprises of companies

from 25 different sectors.









ITC LTD 9.97


COAL INDIA LTD 8.05

OIL & NATURAL GAS CORPORATION LTD 7.96

BAJAJ AUTO LTD 6.40

HERO MOTOCORP LTD 6.24

NTPC LTD 5.12

BHARAT PETROLEUM CORPORATION LTD 4.42

INDIAN OIL CORPORATION LTD 3.92

BANK OF BARODA 3.20



Auto 12.65

Banks 12.34


Oil 10.42

Minerals/Mining 9.48

Power 5.69

Finance 5.55

Industrial Products 2.55

Cement 2.38


Key Fund Details





Other Key Details




NSE/BSE Symbol: RELDIVOPP

Bloomberg Ticker: RDIVOPP:IN

Expense: 0.35%


( Dec 2014 to Nov 2015): 0.37%


Beta: 0.88


R Squared: 0.82







Confidential Slide

R*Shares Gold ETF

41

(An Open Ended Gold Exchange Traded Fund that tracks the

domestic prices of gold through investments in physical gold)



The investment objective is to seek to provide returns that closely correspond to returns provided by

price of gold through investment in physical Gold (and Gold related securities as permitted by

Regulators from time to time). However, the performance of the scheme may differ from that of the

domestic prices of Gold due to expenses and or other related factors. However, there can be no

assurance that the investment objective of the scheme will be achieved.

About the Benchmark: Physical Gold

The Physical Gold has fineness (or purity) of 995 parts per 1000 (99.5%) or higher.

R*Shares Gold ETF

Confidential Slide

R*Shares Gold ETF Portfolio

43

R*Shares Gold ETF

Source: RMF Website

Note: The holdings mentioned form a part of the portfolio of the scheme and may or may not form a part of the portfolio in future. Please read Scheme

Information Document carefully for more details and risk factors.

Holding Weightage (%)

GOLD 995 1KG BAR-Ahmedabad 61.29

GOLD .995 1KG BAR - Mumbai 38.75

Sub Total of Gold 100.04

Cash and Other Receivables -0.04

Grand Total 100.00


Key Fund Details




R*Shares Gold ETF


Beta: -0.28


R Squared: 0.07

Sharpe Ratio: -0.10

Other Key Details




NSE/BSE Symbol: RELGOLD

Bloomberg Ticker: RELGOLD:IN

Expense: 1%


( Dec 2014 to Nov 2015): 0.04%

Confidential Slide

Reliance Mutual Fund: ETF Offerings

Fund Manager : Omprakash Kuckian (w.e.f 01/09/2015)

Following are the key features of R*Shares ETFs:

45

Note: Data as on November 30, 2015. For latest Expense Ratio, please visit the website www.reliancemutual.com.

R*Shares Nifty ETF

NSE/BSE Symbol: RELNIFTY

Bloomberg Ticker: RELNIFT:IN

Benchmark: Nifty 50 Index

Inception Date: 27/11/2013

Expense - 0.08%

Approx Basket Value on 30-Nov15

Rs.40.78 lac

R*Shares Sensex ETF

BSE Symbol: RELSENSEX

Bloomberg Ticker: RSENSEX:IN

Benchmark: S&P BSE Sensex


Expense - 0.08%


Rs.26.57 lac


NSE/BSE Symbol: RELCNX100

Bloomberg Ticker: RCNX100:IN

Benchmark: Nifty 100 Index


Expense – 1.50 %


Rs. 81.76 lac


NSE/BSE Symbol: RELBANK

Bloomberg Ticker: RBETF:IN

Benchmark: Nifty Bank Index


Expense - 0.20%


Rs.18.87 lacs


NSE Symbol: RELCONS

Bloomberg Ticker: RCONSUM:IN

Benchmark: Nifty India Consumption

Index


Expense - 0.35%


Rs.54.22 lac


NSE Symbol: RELDIVOPP

Bloomberg Ticker: RDIVOPP:IN

Benchmark: Nifty Dividend

Opportunities 50 Index

Inception Date:23/04/2014

Expense - 0.35%


Rs.29.64 lac

R*Shares NV20 ETF

NSE/BSE Symbol: RELNV20

Bloomberg Ticker: RELNV20:IN

Benchmark: Nifty 50 Value 20 Index


Expense – 0.35%


Rs. 21.56 lac

R*Shares Gold ETF

NSE/BSE Symbol: RELGOLD

Bloomberg Ticker: REGOLD:IN

Benchmark: Physical Gold


Expense - 1%

Approx Basket Value on 31 Nov-15 Rs. 22.69 lac

http://www.reliancemutual.com/





Confidential Slide

Scheme Specific Risk Factors: Trading volumes and settlement periods may restrict liquidity in equity and debt investments.

Investment in Debt is subject to price, credit, and interest rate risk. The NAV of the Scheme may be affected, inter alia, by changes in

the market conditions, interest rates, trading volumes, settlement periods and transfer procedures. The NAV may also be subjected to

risk associated with tracking error, investment in derivatives or script lending as may be permissible by the Scheme Information

Document.

BSE Disclaimer: It is to be distinctly understood that the permission given by BSE Ltd. should not in any ways be deemed or

construed that the SID has been cleared or approved by BSE Ltd. nor does it certify the correctness or completeness of any of the

contents of the SID. The investors are advised to refer to the SID for the full text of the Disclaimer clause of the BSE Ltd.

NSE Disclaimer: It is to be distinctly understood that the permission given by NSE should not in any way be deemed or construed that

the Scheme Information Document has been cleared or approved by NSE nor does it certify the correctness or completeness of any of

the contents of the Draft Scheme Information Document. The investors are advised to refer to the Scheme Information Document for

the full text of the Disclaimer Clause of NSE

Disclaimers The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and

therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. Certain factual and

statistical information (historical as well as projected) pertaining to Industry and markets have been obtained from independent third-

party sources, which are deemed to be reliable. It may be noted that since RCAM has not independently verified the accuracy or

authenticity of such information or data, or for that matter the reasonableness of the assumptions upon which such data and

information has been processed or arrived at; RCAM does not in any manner assures the accuracy or authenticity of such data and

information. Some of the statements & assertions contained in these materials may reflect RCAM’s views or opinions, which in turn

may have been formed on the basis of such data or information.

Before making any investments, the readers are advised to seek independent professional advice, verify the contents in order to arrive

at an informed investment decision. None of the Sponsor, the Investment Manager, the Trustee, their respective directors, employees,

affiliates or representatives shall be liable in any way for any direct, indirect, special, incidental, consequential, punitive or exemplary

damages, including on account of lost profits arising from the information contained in this material.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

46

Thank you

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