Expense Ratios of Mutual Funds in India

It’s hard to find what Indian mutual funds charge their customers to manage their money for them. The so called “expense ratio.” Try to find it on, say, the UTI website, or SBI’s MF website.

Also, since January 2013, SEBI (the market regulator) made it mandatory for all mutual fund houses (AMCs) to offer what is called a direct plan. Every fund offered by every AMC will have a direct plan where the AMC will charge you a lower expense ratio. This is the money saved by the AMC because you went directly to them, and not through your neighborhood bank branch manager or ShareKhan. This lower expense ratio is also hard to find.

My favorite mutual fund research website, Value Research Online (vro.in) also, surprisingly, does not make it easy to find the expense ratio of a particular fund. Other sub-standard sites like Money Control do not care about listing expense ratios at all.

Now, why the fuss about expense ratios?

  1. You do want the cheapest deal, don’t you?
  2. A fund that charges 2.6% vs. a fund that charges 0.15% to manage your money. Compound this difference over 15 years, and you will see what the fuss is about.

So, what’s the solution?

  1. Call the AMC directly. Some of the “customer care” personnel do not know what a “direct plan” is. Tough luck. But this approach typically works.
  2. Go to any list view on Value Research Online’s website — say, funds from HDFC, or all Large Cap Funds, or any other list that can be sorted on expense ratios. This seems to be the only way to find expense ratios in this otherwise great website.
  3. Download the latest factsheet from the AMC website. Most AMCs do have expense ratios buried deep inside the takes-forever-to-download facesheet somewhere.
  4. I hate saying this, but invest in HDFCFund. I am not affiliated in any way to HDFC or HDFCFund, but I found their website (logged in and logged out) the best to use. They list their expense ratios boldly, they offer cheap expense ratios, you have a great range of funds, their index funds are very cheap, and you can do everything online (except for opening the account).

I have been a direct plan customer of UTI, SBI, ICICI-Prudential, IDFC, HDFC, Taurus, and Quantum Mutual Funds. Here’s my order of preference based on the range of funds, past performance of funds, expense ratios, complete online usage, and overall experience.

  1. HDFCFund
  2. IDFC (if they had a Flex STP, they would rank #1 with HDFC)
  3. ICICI-Prudential (Cannot cancel STP’s online)
  4. Quantum Mutual Fund (wish they had a slightly wider range)
  5. UTI, SBI, and Taurus: all of their websites sucked. Funds are ok.

Well, that’s that.

Craft Beer in Bangalore

IPA beka?

IPA, Russian Imperial Stout, Blonde, Hefeweizen, Maibock, Pumpkin Ale, Belgian Tripel, Classic Pilsner, and such: all on tap.

Moving back from the US in 2012, one worrying thought at the back of my head was — where do I get good beer in Bangalore? Back in the late 90’s, I often drank unnamed beers on tap at Purple Haze, Guzzlers’ Inn, Pecos, Tavern at the Inn, and similar places. But now, where do I find the fresh hoppy lip-smacking taste of a good IPA? Or a thick syrupy malty Imperial Stout?

Well, Bangalore happens to be the craft beer capital of India. And nothing is more fun than asking “Yeshtu ee beer ABV?” and hearing “Aaru vare” from your bartender.

Here’s my list:

Windmills CraftworksEd Tringali is the brewmaster at this fantastic brewpub located in the EPIP zone in Whitefield. Their IPA is always on tap, and they have some special seasonals that come in during the right…er…seasons. Their Christmas Ale was mindblowingly good. It’s somewhat of a library bar with a Jazz music scene. But I go there strictly for the beer. But it is dreadfully out of the way for your Whitefield-free average Bangalore beer drinker.

Arbor BrewingGaurav Sikka is the man behind the scenes here. His story on how he brought Arbor Brewing from Ann Arbor, Michigan to Magrath Road, Bangalore is for the ages. Their IPA is hoppin’ hell great. This is my favorite brewpub in town. Actually, in the world. Logan Schaedig, their brewmaster, experiments all the time. Rye IPA, Espresso Stout, Saffron infused lager, Beetroot in Beer (!), and a few others that have all turned out great, if you ask me.

Toit: This is my least favorite of all the good brewpubs in town. Mostly because of how bad the service is, and how they never fill their pint glasses fully. There is always an inch of room above the head. Just skimming a bit of cash from customers. The redeeming thing about Toit was the Pumpkin Ale. Their regular Dark Knight stout is spectacular as well. Conveniently accessible under Indiranagar Metro station.

The Biere Club: Derek, the general manager is a great guy and has been around the Bangalore fine-dining, clubbing, and pub scene forever. The beer is good — though sometimes you might get served a great Belgian Tripel in a old-school German Stein (mug). But they do have the good glasses for more discerning beer drinkers. Bang in the middle of Bangalore ‘downtown’, probably the most accessible of all the brewpubs.

Punjabi by Nature: More of a food place than a beer place. And it shows. The ales are ok, the pilsners are fine, the stouts are passable. Only if you are in the Koramangala area. Not worth going out of your way — at least for beer.

Barleyz: They have the usual collection of Mild Ale, Indian-Craft-Brew-Staple Wit beer, another Wit beer (yes. They have two Wit beers), and something called the Jaggery Ale. The place looks a bit like NASA (Church Street), and is again, worth visiting only if you are in Koramangala.

A few others are waiting to open their beers to us, but are held back by licences, and other such crazy laws of Karnataka. It always makes for great storytelling: to hear about how the brewpubs got around Karnataka liquor laws to just brew beer and get people who love beer to drink it.

I, for one, am happy that they did it.