All returns are post fees & net of expenses (TWRR). The returns are as on 17th September,2021.
Inception Date & Benchmark:
Consistent Compounders Portfolio: Inception: 1st Dec,2018 Benchmark: Nifty 50 TRI
Little Champs Portfolio: Inception:28th Aug,2019 Benchmark: S&P BSE Small Cap TRI
Kings of Capital Portfolio: Inception:28th July ,2020 Benchmark: Bank Nifty TRI
3 MYTHS vs 3 REALITIES:
As per RBI’s August 2017 Indian Household Finance Survey report, 95% of Indian savings are locked up in physical assets – land, property & gold. Barely 5% of savings is invested in financials products and out of that too large chunk is invested in fixed deposits and debt products. Somehow most of Indians feel that investing in physical assets will help them compound their wealth but reality is far away from it.
MYTH 1: GOLD WILL HELP ME COMPOUND MY WEALTH
REALITY: Over the last 30 years, the price of gold (in rupee terms) has compounded at 9% annualised, marginally higher than the rate of consumer price inflation prevalent in India, thus indicating that gold can act as a reliable store of value in India but not as a wealth compounder. Also, prices of gold are very cyclical and investor has to perfectly time the entry and exit in the asset class to make decent returns. For eg: investor who invested in the decade between March 1990 to March 2000 gold would have compounded his investment by mere 3.5% per annum. (Source for gold prices: RBI’s database on Indian economy).
MYTH 2: REAL ESTATE WILL HELP ME GROW MY WEALTH
REALITY: Stuck projects, illiquidity, black money and barely beating fixed deposits rate has been the hallmark of real estate investing in the last decade or so. According to RBI reports real estate has given at best 2-3% return in excess of FD rates in last the decade.
An annual rent anywhere between 2 to 5% of the total asset valuation also does not exude confidence in the asset class. Real estate continues to remain an unpredictable asset class and windfall gains come to the extremely lucky or the incredibly astute investor.
MYTH 3: DEBT MUTUAL FUNDS OFFER DECENT RETURNS WITH LOW VOLATILITY
REALITY: Investors who believed that debt mutual funds offer decent return with low volatility received shock of their life when their hard-earned lifetime savings got stuck in various prominent mutual fund houses (now defunct or closed). These funds had high risk, low-quality paper in their debt funds but was sold as a low risk product with good returns. To understand in detail how debt product can burn your capital, we highly recommend you to read our book ‘Coffee Can Investing: the Low Risk Route to Stupendous Wealth’ (2018).
(In our book ‘Coffee Can Investing: the Low Risk Route to Stupendous Wealth’ (2018), we explained the issue in detail: A debt mutual fund’s return is a function of: 1) Yield to Maturity or YTM, 2) Mark to Market or MTM, and 3) Expense Ratio.)
In general, investments in fixed income or debt instruments are meant for capital protection (not wealth creation) with returns enough to cover inflation and a bit and are often meant for short term horizons (less than 3 years). Any longer a horizon, equity risks fall significantly and provide a superior route to wealth creation.
Investors are now realizing that they must invest in equity as an asset class if they want to beat inflation and create wealth for themselves and for their next generations. We at Marcellus know of only one way to generate significant real returns in a consistent manner – buy clean, well-managed Indian companies selling essential products behind very high barriers to entry. We call this approach to investing Consistent Compounding and have seen, both in theory and in practice, that it works.
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1. Distributor Code Change Process
We have made few transitions to the Distributor Code Change Process.
· Change in Effective date of new Distributor. Cut off and TATs.
1) The new Distributor Effective Date will be T + 8 working days. Last day and first day of the month are considered as Black out days. Black out days will not be counted while calculating Effective date and TAT.
Eg:If the request came on 1st of October 2021, effective date will be 13th October 2021.
If the request came on 21st September 2021, effective date will be 4th October 2021.
2) TAT for processing Broker code change is T +10 workings days.
· Criteria for Change in Distributor
1) Submit filled and signed Distributor change form and relevant fee schedule to Marcellus. Download latest form from the website https://marcellus.in/marcellus-forms/
2) Requests where new Distributor is migrating the client by offering lower fees will not be entertained. The broker code change will happen at the same fee rate and same incentive share.
3) Fees will be computed and recovered from the clients account on pro rata basis and the incentive / revenue will be shared with the Old Distributor in the quarter end cycle .
4) Change in distributor is not available for LCP Little Champs portfolio.
· Process flow:
1) Submit filled and signed Distributor change form and relevant fee schedule to Marcellus.
2) On receipt of the requests, We will notify the old distributor about the migration and will have 7 days to retain the client. If the client wants to revoke, he can do it by sending email to Marcellus within 7 working days.
3) On the 8th working day if revocation request is not received, changes will be made. New Distributor will be given effect as on T+8 working days in clients account. Fees until T+7 working days will be computed and recovered in client’s account.
4) Distributor revenue share will be paid in the upcoming quarter end cycle.
2. Changes to Fee change process
1) Fee change is only allowed at the time of clients annual Billing cycle. ( It is not allowed during the middle of a billing cycle)
2) Marcellus will be sending emails to clients to make them aware about the upcoming billing cycle, about the fees recovery and settlement and about the window of fee change.
3) Clients will have to submit Fee change form within the timeframe given in the email.
4) If the clients Annual Billing cycle is in October 2021. He / She will have to submit the fee change form by 20th October 2021.
5) Forms submitted after 20th will not be accepted.
6) Download new Fee change form from website.
7) If Fee change is submitted along with Broker code change, then whatever is the Effective date of New Broker code change, will also become effective date of new fee structure.
8) Ideally the effective date of new fee change is the start date of the new annual cycle.
9) TAT for completing the request is T+4.
1) Please always download new forms from the website. Old forms if submitted, will not be accepted.
1. Addressing 6 KYC attribute update queries.
· How to address:
1) Check if the clients email id and mobile is correct.
2) In case if the client is using the same mobile no. and email ID in his other family members demat account,he should declare that email id in the family members Demat account as Family.
3) Family will include Spouse , Dependent Parent and Dependent Children.
4) If the other demat account does not form a part of family relation described above then the email id needs to changed in the Demat account of the other Family member.
5) If case if the client has a joint demat account. If yes then please check if both the holders have updated same or different email ID and family flag is updated.
6) Both holders cannot put Family flag as Self. One of them has to put it as Self and the other as Family provided the other holder is Spouse, Dependent parent or Dependent Children.
If the 2nd holder is not a part of the family category then they need to update a new email id / mobile number.
· How to Solve?
1) If the clients details are tagged as invalid as per the email sent by Marcellus, then you should run the above checks with your client.
2) The data can be correct but the Family flag tagged would be incorrect. Hence you are required to validate the Data and the Family flag.
In sole account holder case: If the family flag is incorrect, please check with client if any other holder person is using his email id or mobile number. If yes then he should ensure correct family flag is updated for the other holder. The logic is 2 people cannot hold same email id claiming as Self under family flag section.
In case of individual accounts, Partnership firm (where Partner is individual) and Trust ( where trustee is individual ) need to obtain 6 KYC form. Download https://marcellus.in/6-kyc-individual/ .
The deadline communicated by NSDL is December,2021
4. Linking PAN & Adhaar for your clients.
1. The deadline for linking PAN & Adhaar is been extended until 31st March 2022.
2. Demat account can be freezed for debits if the PAN & Adhaar are not linked by 31-03-2022.
3. Please inform your clients to link their PAN and Adhaar .
5. Requesting for fee workings and statements.
1) Fee workings will be shared only after the fee is billed to the client.
2) If the fees is not billed as an expense to the client, we are unable to provide the workings.
3) The fee workings and calculations can be requested only once the request is executed.
4) The rationale is that the Fee numbers are generated through the system. Hence the calculation can be provided once the redemption is completed and system has generated the numbers and workings.
5) We can only provide the Standard statements available in Wealth spectrum.
6) The statements can be provided only in the standard format as generated from the system.
6. FOS – Form Support Service from Marcellus
To enhance onboarding experience for our channel partners & clients. Marcellus has taken an initiative to extend support on Prefilling of all New Clients PMS & Requisite Demat + others forms by Marcellus Onboarding Team. Through this initiative we expect to solve complexities involve in PMS documentations due to multiple set of accounts to be opened for single client with different entities.
Key benefits of this Process are listed down:
ü Enable KRA check and identify need for IPV/OSV upfront and filter AML Validation.
ü Improvise TAT of account opening and enable clients to invest sooner.
ü Eliminate Re-iteration of seeking information and ratification from client to solve observations.
ü Service & Operations efficiency at both Marcellus and Business Partner end.
Process Steps for the Marcellus Form Support:
R Download the Client Information Form [CIF] for Resident Client, NRI & Non individual through links shared below:
Ø Resident Client: https://marcellus.in/new-cif-for-individual-clients-ver-2-0/
Ø All Non-Individual: https://marcellus.in/new-cif-for-non-individual-clients-ver-2-0/
Ø Non-Resident Indian: https://marcellus.in/new-cif-for-nri-clients-ver-2-0/
R Fill in complete client (s) details in CIF and refer to supporting KYC documents to be shared along with CIF.
R Ensure to share CLEAR scan copies of supporting documents & confirm dispatch address details.
R Email CIF and Supporting KYC documents to firstname.lastname@example.org for validation.
R Respective SRM will validate the complete information in CIF and supporting KYC documents.
R If Validation is complete, team will carry of necessary KRA AML checks and prepare the Prefilled form based on the CIF & KYC documents.
R In case of need for IPV & OSV respective SRM will reach back to Partners.
R Prefilled forms will be couriered to the requested address with T+1 days of the complete validation date.
Ø All information in CIF is mandatory and will be used in filling of complete form.
Ø Incomplete CIF, or missing info. or unclear documents will be rejected by SRM at the time of validation process and will not be processed for form preparations.
Ø Request clients to share clear images of the proof scan copies requested and in the readable format, unclear copies will not be accepted.
Ø All CIF submitted before 12:00 pm will be considered for validation on same day and dispatch by next working day.
Ø All CIF Received after 12.00 PM will be considered for dispatch on T+2 working day.
Ø Ensure to mention the “Dispatchment Address” in the CIF.
Ø If CIF is valid, forms will be prepared and dispatched by end of next working day evening.
Ø In case of any further queries & clarification, request you to connect with your respective Service Relationship Manager for assistance.
**For operations related queries please write to email@example.com**