Mutual Funds v/s ULIPs:Mutual Funds v/s ULIPs:

The Clash of the Titans???The Clash of the Titans???

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Just another fight for the investor’s wallet…Just another fight for the investor’s wallet…

The focusThe focus

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Misleading DemeanorsMisleading Demeanors

Insurance shouldInsurance should

Insurance shouldInsurance should Market-risk Market-risk bearing productsbearing products

Volatility, Stress & Unsurety

Insurance Meaning: Insurance is designed to replace the earning capacity of an individual in the case of unexpected loss of life

ULIP Meaning: This is the type of investment where the characteristics of insurance and mutual fund are combined. 

InsuranceInsurance MFs shouldMFs should InvestmentsInvestments

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It’s all about the money!It’s all about the money!

Rather than use words to explain, take a look at a comparative cost analysis

Mutual FundsMutual Funds ULIPsULIPsV/SV/S

Since ULIPs work on a 3 & 5 year premium paying basis, lets assume you invest the same amount in Mutual Funds too for regular periods over the same tenure

Assuming a sum of Rs.100,000 invested in both MFs and ULIPs each year for 5 years,

Here’s how the Returns stack up!

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*The Mutual Fund is a zero-commission paying fund•All figures are as per industry sources and have been used for illustrative purposes.

•Each scheme may differ from the other and returns may or may not be sustained.•The Charges have been sourced from existing insurance policy documents.

ULIPs that issue bonuses in the 10th year could be at par with Mutual Funds.

MF* ULIP MF* ULIP MF* ULIP MF* ULIP MF* ULIP

Investment Amount (INR) 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000

Premium Allocation Charges (%) - 15% - 10% - 5% - 3% - 0%Policy Administatration Charges (INR) 600 600 600 600 600

Amount Invested (INR) 100,000 84,400 212,700 185,150 339,713 304,448 644,179 597,598 1,815,366 1,772,894

Returns on Investment (15%) 15,000 12,660 31,905 27,772 50,957 45,667 96,627 89,640 272,305 265,934

Total Fund Value (INR) 115,000 97,060 244,605 212,922 390,670 350,115 740,806 687,237 2,087,671 2,038,828 Fund Management Charges (FMC) (INR) 2.0% 1.35% 2.0% 1.35% 2.0% 1.35% 2.0% 1.35% 2.0% 1.35%

Fund Value After FMC (INR) 112,700 95,750 239,713 210,048 382,856 345,388 725,990 677,960 2,045,918 2,011,304

Difference in Fund Value 16,950 29,665 37,468 48,030 34,614

Year 10Year 5Year 1 Year 2 Year 3

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Breaking Free!Breaking Free!

So, you have an urgent need for money, and you choose to So, you have an urgent need for money, and you choose to redeem your investments…redeem your investments…

Well, Well, Well… comparing charges to be paid while exiting your investment – Note the Difference!

* The Mutual Fund considered is the Quantum Long Term Equity Fund which has its unique Exit Load Structure which encourages the principles of long term investing. # The charges have been sourced from existing insurance policy documents.

Regular Premium Single Premium0-6 months 4% 1 15% 5%6-12 months 3% 2 10% 5%12-18 months 2% 3 7.5% 5%18-24 months 1% 4-5 5% 2%

After 24 months - 6 year onwards - -

Mutual Funds * ULIPs(A sample product)

Surrender Charge#

Policy YearRedemption Date from

Date of Allotment Exit Load (% of Fund Value)

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So now that you know the ULIP story…So now that you know the ULIP story…

How can you protect your wallet?How can you protect your wallet?

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*Source for 5-Star rating: Value Research Fund Ratings are a composite measure of historical risk-adjusted returns. In the case of equity funds, this rating is based on the average monthly returns for the last 3-year and 5-year periods. These ratings do not take into account any entry or exit load. Five-stars indicate that a fund is in the top 10 per cent of its category in terms of historical risk-adjusted returns. 155 open-ended Equity: Diversified Funds were rated as on February 28, 2010. Value Research Fund Ratings are subject to change every month. The rating is based on primary data provided by respective funds; Value Research does not guarantee the accuracy. Standard SMS Rates Apply.

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DISCLAIMERInvestment Objective: Quantum Long –Term Equity Fund’s (QLTEF) investment objective is to achieve long-term capital appreciation by investing primarily in shares of companies that will typically be included in the BSE 200 and are in a position to benefit from the anticipated growth and development of the Indian economy and its markets. Asset Allocation: QLTEF will primarily invest in Equity and Equity related securities, but may invest in money market instruments to meet liquidity needs. Terms of Issue: QLTEF is an open-ended Equity Scheme offering Growth and Dividend Options. The units can be subscribed/redeemed at the applicable NAV, subject to applicable load on all business days. Entry Load: Nil. Exit Load: On redemption/switchout within 6 months of allotment- 4%, after 6 months but within 12 months- 3%, after 12 months but within 18 months-2%, after 18 months but within 24 months-1%, after 24 months-Nil. Risk Factors: All Mutual Funds and securities investments are subject to market risks including uncertainty of dividend distributions and the NAV of the schemes may go up or down depending upon the factors and forces affecting securities markets and there is no assurance or guarantee that the objectives of the scheme will be achieved. Quantum Long –Term Equity Fund, is the name of the scheme and does not in any manner indicate either the quality of the Scheme, its future prospects or returns.. Scheme specific risk: Equity and Equity related instruments are by nature volatile and prone to price fluctuations due to both macro and micro factors. The Investor may lose money over short or long period due to fluctuation in Scheme’s NAV in response to factors such as economic and political developments, changes in interest rates and market movement and over longer periods during market downturns. Trading volumes, settlement periods and transfer procedures may restrict the liquidity of the investments of the QLTEF. Statutory Details: Quantum Mutual Fund (the Fund) has been constituted as a Trust under the Indian Trust Act, 1882.Sponsors: Quantum Advisors Private Limited. (liability of Sponsor limited to Rs. 1,00,000/-) Trustee: Quantum Trustee Company Private Limited. Investment Manager: Quantum Asset Management Company Private Limited (AMC). The Sponsor, Trustee and the Investment Manager are incorporated under the Companies Act, 1956. The past performance of the Sponsor / AMC/ Fund has no bearing on the expected performance of the scheme. Mutual Funds investments are subject to market risks. Please read the Scheme Information Document / Key Information Memorandum / Statement of Additional Information / Addenda carefully before investing. Scheme Information Documents /Key Information Memorandums/ Statement of Additional Information can be obtained at any of our Investor Service Centers or at the office of the AMC 505, Regent Chambers, 5th Floor, Nariman Point, Mumbai – 400 021 or on AMC website www.QuantumAMC.Com