WHAT IS A MUTUAL FUND?

A mutual fund is an entity that pools the money of many investors -- its unit-holders -- to invest in different securities. Investments may be in shares, debt securities, money market securities or a combination of all these. Those securities are professionally managed on behalf of the unit-holders, and each investor holds a pro rata share of the portfolio i.e. entitled to on a pro rata basis, any profits when the securities are sold, but subject to any losses in value as well.

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WHAT IS AN OPEN-END FUND?

These are mutual funds which continually create new units or redeem issued units on demand. They are also called unit trusts, because they are registered as trusts. The unit holders buy the units of the fund or may redeem them on a continuous basis at the prevailing NAV.

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WHAT IS JS Investments Limited (formerly JS ABAMCO Limited)?

JS Investments Limited (formerly JS ABAMCO Limited) is a public limited company duly licensed under Non-banking Finance Company (NBFC) Rules to carry investment advisory and asset management services. JS Investments Limited (formerly JS ABAMCO Limited) manages various open-end and closed-end fund schemes.

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HOW SECURE IS MY INVESTMENT WITH JS Investments Limited (formerly JS ABAMCO Limited)?

Security Exchange Commission of Pakistan (SECP) has licensed JS Investments Limited (formerly JS ABAMCO Limited) under the Non-banking Finance Company (NBFC) Rules. JS Investments Limited (formerly JS ABAMCO Limited) meets the criteria for issuance of license set by the SECP to guard investors against fraudulent companies. All the funds related to the investors are under the custody of Trustee; in our case Central Depositary Company (CDC). As far as value of the investments is concerned they are subject to stock market conditions.

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IS YOUR COMPANY RATED BY ANY CREDIT RATING AGENCY?

Our management company is rated "AM2" by PACRA (Pakistan Credit rating Agency).

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HOW MUCH INITIAL INVESTMENT IS REQUIRED TO BE MADE IN JS Investments Limited (formerly JS ABAMCO Limited) OPEN-END FUNDS?

An investor is required to purchase minimum one unit. So the initial investment can be made to the extent of the price of one unit prevailing at the time of investment.

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HOW LONG DO I NEED TO HOLD MY UNITS?

There is no lock-in period in the case of open-end funds (except for the core investors). Units can be encashed at any time by filling redemption form.

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WHO CAN APPLY?

Note:

1. In case of existing holders, if any of the documents which have been previously submitted, fresh submission of the same documents may not be required.
2. If the application is incomplete or incorrect in any way the distribution company will advise the applicant in writing to remove the discrepancy within a period of 15 days, failing which the application will be rejected and the amount will be refunded without any interest or mark-up.
3. The distribution company will be entitled to verify the application form. In case of any incorrect information the application may be rejected.

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HOW TO APPLY FOR PURCHASE OF UNITS?

INSTURMENT IN FAVOUR OF

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HOW TO APPLY FOR REDEMPTION OF UNITS?

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TRANSFER OF UNITS

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TRANSFER FROM ONE FUND TO ANOTHER

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HOW DO I KNOW THE STATUS OR POSITION OF MY INVESTMENT?

You can view your account statement to confirm your holding and the cost of investment. Current value of the investments can be determined by multiplying the holding with current redemption prices. The current prices of the funds are quoted in Business Recorder, available on our website and also emailed if requested. You can also contact JS Investments Limited (formerly JS ABAMCO Limited) Investor Services at 111-222-626.

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HOW FREQUENTLY WILL THE STATEMENT OF ACCOUNTS BE SENT?

The statement of account is issued on purchase of units. After the purchase, if there is any change in the status/particulars of the investor, an updated account statement will be sent. Such changes include further purchase of new units, partial redemption of units, transfer of units etc.

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CAN I BUY THE UNITS JOINTLY WITH OPTION FOR EITHER ONE OR SURVIVOR TO SIGN THE REDEMPTION?

Yes.

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CAN I INVEST IN ANY CURRENCY?

Investment can only be made in Pak rupees.

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WHAT IS THE MODE OF PAYMENT?

Payment is acceptable in the form of crossed cheque, demand draft or pay-order.

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DO YOU ACCEPT OUT-STATION CHEQUES?

Out-station cheques should be deposited in our authorized distribution company in the city from where the cheque is issued.

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CAN AN INVESTOR OPERATE HIS INVESTMENTS FROM ABROAD?

Yes, you can invest in the funds by opening a Special Convertible Rupee Account. This account can be operated by way of courier or fax instructions.

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DOES JS Investments Limited (formerly JS ABAMCO Limited) OFFER ANY MONTHLY INCOME SCHEME?

Currently JS Investments Limited (formerly JS ABAMCO Limited) doesn't offer any such schemes.

CAN THE DIVIDENDS BE REINVESTED?

Yes, dividends can be reinvested at NAV as on that period.

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WHEN ARE THE RETURNS REALIZED?

Dividends are paid annually after the year-end (June 30). Returns in the form of gain can be realized by redeeming the units at any point of time.

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HOW LONG DOES IT TAKE TO RECOVER MY WHOLE INVESTMENTS IN TERMS OF INITIAL INVESTMENTS?

It depends on the performance of the fund.

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IS THERE TAX DEDUCTION AT SOURCE ON INVESTMENT?

On payment of dividends 10% tax is deducted on the portion of dividend income which is derived from sources other than capital gains. For example, if JS Investments Limited (formerly JS ABAMCO Limited) has announced dividend of Rs100/- as Income out of which 55% was derived from capital gains and 45% from other income, 45% will be liable to tax deduction.

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WILL ZAKAT BE DEDUCTED AT SOURCE?

Yes, Zakat will be deducted at source unless Zakat declaration form is submitted with the transfer agent.

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IS THERE ANY TAX INCENTIVE FOR INVESTMENT IN MUTUAL FUNDS?

Yes there is a tax credit on purchase of open ended mutual fund and you can avail the tax credit if you retain the investment for one year. The Income Tax Law provides a tax rebate at an average rate of tax on investment in new securities /units issued first time to the extent of 10% of taxable income, Rs. 100,000 or the amount of investment whichever is lower.

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ARE THESE OPEN ENDED FUNDS LISTED ON THE STOCK EXCHANGE?

Yes, they are listed on the Lahore stock exchange.

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CAN WE SELL/PURCHASE THE UNITS THROUGH THE STOCK EXCHANGE?

No. Currently, the open ended funds are not being traded on the stock exchange You can purchase or redeem units from our head office in Karachi or branch offices in Lahore, Islamabad, Gujranwala, Sialkot and Hyderabad and the distribution companies authorized by JS Investments Limited (formerly JS ABAMCO Limited) in this regard.

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CAN I BORROW AGAINST THE INVESTMENTS IN UNITS?

Yes. The following procedure will be involved:

• First investor has to fill out the pledge form available with us and submit it to the respective bank.

• The bank will send that form to Transfer agent to mark lien on the units.

• The transfer agent mark lien on these units and intimate the same to the bank.

• The bank then, subject to its own conditions, releases the loan.

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HOW ARE UNITS PRICED?

The unit is priced based on the NAV (net asset value). Normally units are offered to the public at price NAV plus sales load. This sales load is often a %age of NAV.

The NAV is the current market worth of a mutual fund unit. It is calculated on business days by taking the funds' total investments, cash and any accrued earnings deducting liabilities, and dividing the remainder by the number of units outstanding. NAV of units under any fund/ scheme shall be calculated as shown below.

NAV (Rs.) = (Market or Fair Value of the fund investments + Current Assets - Current Liabilities and Provisions) / No. of units outstanding under the fund

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WHAT IS A SALES LOAD?

Open-end funds recover a sales charge (called sales load) from unit/ share holders. Sales load is a certain fixed percentage of NAV. Some mutual funds recover the sales load when investors purchase the units, whereas others do when investors redeem the units. Mutual funds generally do not charge sales load on reinvestment of dividend. The shorter the period of investment, the greater will be the impact of the sales load. Maximum benefit can be derived from mutual fund investment by regularly investing, reinvesting the dividend and holding the investment for a longer period.

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HOW DO I CALCULATE RETURN FROM OPEN-END MUTUAL FUNDS?

Investors can apply the equation and guidelines as given below to calculate the return from open-end mutual funds. Following symbols stand for:
a = Date of investment
b = Date of calculation of return or date of redemption
x = (b-a) i.e. period of investment holding
PP = Purchase Price or NAV at the beginning of relevant year
RP = Redemption Price or NAV at the end of relevant year
D = Dividends received during the investment holding period or relevant year
Profit from investment can be worked out as under:
(RP+D-PP)
The return can be worked out by dividing the profit from investment by the PP and then be annualized. Investors can work out the return for the entire holding period (i.e. x), or separately for each year.

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What is JS Pension Savings Fund?

JS Pension Savings Fund is a defined contributions voluntary pension plan. This means that participants are free to choose ‘how much’ and ‘how frequently’ they contribute towards their pension goal; and upon retirement they will receive the accumulated balance in their Individual Pension Account.

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What does the plan provide?

• Upon retirement participants may withdraw the a tax-free lump sum of up to 25% of the accumulated balance in their Individual Pension Savings Account.

• With the remainder of balance participants will have multiple convenient choices for a monthly stipulate. They may either:            

  • Enter Into a Payment Plan

  • Purchase an Annuity Plan

• Alternatively, participants may also withdraw the entire balance immediately – however an amount in excess of 25% will be subject to tax.

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How ARE CONTRIBUTIONS MADE?

• The JS Pension Savings Fund provides easy and convenient contribution options: cheque, pay order, or at any JS Investments Sales office, EFU sales office and SCB branch.

• Each time a participant makes a contribution, they will be sent a confirmation along with the current Individual Pension Savings Account balance.

• Contribution may be made by either or both the individual themselves or by their employer on their behalf

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WHAT ARE TAX BENEFITS?

• Each contribution towards a participant’s Individual Pension Account will provide tax benefits.

• A tax credit of their total annual contribution up to 20% of their taxable income or PKR 500,000 – whichever is lower.

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Are investments locked into the plan until retirement?

•  No. Participants have the flexibility to withdraw from their Pension Savings Fundbalance at any time, but these withdrawals are subject to tax.

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How ARE INVESTMENTS MADE?

• Each participant is free to choose their own allocation amongst three sub-funds in accordance to their risk appetite: Debt, Equity, Money Market

• Each year, Units within each Individual Pension Account will be re-allocated amongst the sub-funds to ensure that allocation amongst the Sub-funds is in accordance with the Allocation policy selected by the participant

•  Participants may update their allocation policy annually

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What is Free Insurance Cover?

• Subject to a minimum initial contribution, participants shall be provided with free Accidental Death & Disability insurance cover of up to PKR 4 million

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What is Optional Insurance Cover?

• Participants may also elect to take advantage of insurance products at premiums exclusively available to Individual Pension Account holders of JS Pension Savings Fund:

  • Life Insurance - a participant may top-up the free insurance cover and also obtain natural death risk.
  • Critical Illness - to take away some of the financial strain of paying for expensive medical treatment of a critical illness. This benefit pays a one-off cash lump sum, if any one suffers from or undergoes any one of 10 specified critical illnesses.
  • Accidental Hospitalization - provides protection against accidental occurrences that might lead to bodily injuries. The plan offers financial support in case of hospitalization arising out due to accident.
• Note: Optional Insurance Covers will require a premium payment

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