Frequently asked questions
WHAT IS MUTUAL FUND?
Mutual fund is an investment vehicle for pool of funds gathered from multiple investors to be invested in various securities such as stocks, bonds, money markets, and others, according to the investment policy stated in the prospectus.
WHAT IS INVESTMENT MANAGEMENT COMPANY?
An Investment Management Company is an entity whose business activities involve managing the portfolio of mutual fund for clients and investing the assets of the mutual fund in various securities in accordance with the investment policy specified in the prospectus. In carrying out its functions, investment management companies in Indonesia are required to obtain a license and be supervised by the Financial Services Authority (Otoritas Jasa Keuangan). PT Schroder Investment Indonesia ("Schroders Indonesia") is an investment management company that is licensed and supervised by the Financial Services Authority.
WHAT IS OTORITAS JASA KEUANGAN OR THE FINANCIAL SERVICES AUTHORITY?
The Financial Services Authority (OJK) is an independent institution that is free from interference by other parties. It has functions, duties, and authorities in regulation, supervision, examination, and investigation as specified in the Financial Services Authority Law. The OJK plays a crucial role in overseeing and regulating the financial services industry in Indonesia to ensure its stability, integrity, and consumer protection.
WHAT IS CUSTODIAN BANK OF A MUTUAL FUND?
The party that provides custody services for securities and other related assets, as well as other services such as receiving dividends, interest, and other rights, settling securities transactions, and representing the account holders who are their clients, is known as a Custodian Bank. The custodian bank plays a crucial role in ensuring the smooth operation and administration of the mutual fund, including the safekeeping of assets and accurate record-keeping.
In Indonesia, Custodian Banks are required to obtain a license and be supervised by the Financial Services Authority (OJK) in order to operate. The role of a Custodian Bank is crucial in ensuring the safekeeping and proper administration of securities and other assets on behalf of investors.
WHAT IS MUTUAL FUND PROSPECTUS?
A prospectus is any printed statement or written information used for the public offering of a mutual fund, with the aim of investors purchasing mutual fund units, except for statements or information that are not considered prospectuses based on OJK regulations. The prospectus serves as a comprehensive disclosure document that provides important information to prospective investors about the mutual fund, including investment objectives, strategies, risks, costs, and other key details. It is designed to enable investors to make informed decisions and understand the nature of the investment they are considering.
HOW DO MUTUAL FUNDS WORKS?
- At launch, mutual funds issue participation units with a certain net asset value (NAV) per unit. Generally, the initial NAV/unit for Rupiah-denominated mutual funds is IDR 1000 and the initial NAV/unit for Dollar-denominated mutual funds is USD 1.
- When investors purchase units in a mutual fund, they are allocated a certain number of participation units. The calculation of the participation units is based on the amount of funds invested (net of any fees, if applicable) divided by the NAV per unit. By owning participation units, investors effectively own a proportional share of the mutual fund's assets. This means that each unit owner participates proportionally in the fund's profits and losses. As the value of the mutual fund's assets fluctuates, the NAV per unit will change, reflecting the performance of the underlying securities. This allows investors to benefit from the fund's investment returns and share in any gains or losses.
- The investment manager is responsible for managing the funds collected from investors and allocating them to various securities in accordance with the investment policy stated in the prospectus. These securities can include a range of investment instruments such as stocks, bonds, money market instruments, and others. The market value of the securities held in the mutual fund's portfolio will fluctuate over time, which in turn affects the NAV of the mutual fund. By examining the percentage increase or decrease in the NAV per unit compared to the NAV per unit at the time of initial purchase, investors can assess the performance of the mutual fund.
- The investment manager appoints a custodian bank, which acts as an administrator, responsible for executing transactions, clearing with designated banks, securities registration, dividend calculation and distribution, as well as producing the NAV per unit and reporting on investments.
- The mutual fund industry in Indonesia is regulated and supervised by the Financial Services Authority (OJK).
WHAT ARE THE BENEFITS OF INVESTING IN MUTUAL FUNDS?
Mutual funds have become a popular investment choice due to the various benefits they offer to investors, including:
- Legal and regulated: Mutual funds are legal investment instruments and are supervised by the Financial Services Authority (OJK) in Indonesia.
- Professional management: Mutual funds are managed by experienced investment managers who are licensed by the OJK. This allows investors to save time and costs associated with conducting individual investment research, portfolio management, trade settlement, and other administrative tasks.
- Affordability: Mutual funds offer affordability, as units can generally be purchased with a minimum investment amount, often starting from as low as Rp 10,000. This makes investing in the capital market accessible to a wide range of investors.
- Diversification: By investing in mutual funds, investors automatically achieve diversification as the funds are invested in a variety of securities. This helps to spread the investment risk across different asset classes and reduces the impact of any single investment's performance on the overall portfolio.
- Liquidity: Mutual funds provide liquidity, allowing investors to enter and exit their investments easily. Investors can typically buy or sell mutual fund units on any business day at the prevailing NAV.
- Transparency: Mutual funds offer transparency, as the NAV/unit can be monitored on a daily basis. Additionally, investors receive monthly reports that provide a concise summary of the mutual fund's performance and other relevant information.
WHAT ARE THE RISKS OF INVESTING IN MUTUAL FUNDS?
Investing in the capital market involves risk and investing in mutual funds is not free from risk either. Here are some common risk factors associated with investing in mutual funds:
- Risk of decrease in the net asset value (NAV) : One of the risks associated with investing in mutual funds is the potential for a decrease in the net asset value (NAV) per unit. There is no guarantee that the NAV will always increase during the investment period. This risk stems from the fluctuations in the market value of the underlying assets held in the mutual fund's investment portfolio. It is possible for stock prices and/or bond prices to decline both in the short term and long term. The stock and bond markets tend to move in cycles, with periods of price increases and other periods where prices decline. As a result, the value of the mutual fund's assets and, consequently, the NAV per unit can fluctuate over time.
- Risk of changes in economic and political conditions : Changes in economic and political conditions, both domestically and internationally, as well as specific regulations in the money market and capital market, can have an impact on the performance of investment instruments in Indonesia. These factors can indirectly affect the performance of mutual funds.
- Risk of Liquidity : Unit holders of a mutual fund have the right to redeem or sell back their units to the investment manager. The investment manager is responsible for providing sufficient funds to fulfill the redemption requests. However, it's important to note that in certain circumstances, a large number of unit holders simultaneously redeeming their units can pose challenges for the investment manager to immediately provide the necessary cash for redemption. In some force majeure cases, if the fund's liquidity is insufficient, the investment manager may need to suspend redemptions temporarily in accordance with the Collective Investment Contract and regulations set by the Financial Services Authority (OJK).
- Risk of dissolution and liquidation : In certain circumstances, as required by the Financial Services Authority (OJK) and in accordance with applicable regulations, the investment manager may be required to dissolve and liquidate the mutual fund.
- Risk of regulatory changes : Changes in applicable regulations and government policies, particularly in the field of macroeconomics and investment instruments, can indeed impact the level of returns and investment results that mutual funds may achieve. Changes in legislation and/or policies in the tax field can also potentially reduce the income that unit holders may receive.
HOW TO MEASURE MUTUAL FUND PERFORMANCE?
Investors can assess the performance of a mutual fund by looking at the percentage increase or decrease in the NAV per unit. Additionally, mutual fund performance can be evaluated through the fund factsheet, which is published monthly by the investment manager. Benchmarking is commonly used to assess the performance of a mutual fund. A benchmark is a specific index or indicator against which the fund's performance is compared. For example, equity mutual funds often compare their performance against stock market indices such as the Jakarta Composite Index or the IDX80 Index.
HOW ARE MUTUAL FUND ASSETS SAFEGUARDED?
Mutual fund assets are held and administered by a custodian bank that is independent and not affiliated with the investment manager. The custodian bank ensures that the mutual fund assets are kept separate from the assets of the investment manager and the custodian bank itself. This segregation of assets provides an added layer of protection for mutual fund investors. So if something happens to the investment manager or custodian bank, the mutual fund assets will not be disrupted.
WHAT ARE THE DIFFERENT TYPES OF MUTUAL FUNDS AVAILABLE IN INDONESIA?
Here are the types of mutual funds in Indonesia by category:
Based on the method of offering their units
- Open-ended Mutual Fund: In open-ended mutual funds, the units are continuously offered until the maximum number of units specified in the prospectus is reached. Investors in this type of mutual fund can also buy or sell their units on any business day at the prevailing net asset value (NAV). Open-ended mutual funds include money market funds, fixed-income funds, balanced funds, and equity funds.
- Closed-Ended Mutual Funds: In closed-ended mutual funds, the units are offered in a certain quantity during a specific period. Investors in this type of mutual fund can only sell their units during a designated redemption window.
Based on their asset classes:
- Money Market Funds: Money market funds primarily invest in short-term money market instruments such as certificates of deposit (CDs) and bonds with maturities of less than one year.
- Fixed-Income Funds: Fixed-income funds predominantly invest in fixed-income securities, such as government bonds or corporate bonds.
- Balanced Funds: Balanced funds, as the name suggests, invest in a mix of asset classes, including money market instruments, fixed-income securities, and equities. The allocation across different asset classes may vary depending on the fund's investment strategy and objectives.
- Equity Funds: Equity funds primarily invest in stocks or equity-related securities. These funds offer the potential for higher returns but also carry higher risks compared to other asset classes.
Based on their management approach:
- Conventional Mutual Funds: Conventional mutual funds are managed using investment strategies and techniques in accordance with the prevailing regulations.
- Shariah Mutual Funds: Shariah mutual funds are managed in accordance with the principles of Shariah. These funds provide opportunities for investors to participate in the financial markets while adhering to Shariah principles.
WHAT TYPES OF MUTUAL FUNDS DOES SCHRODERS INDONESIA MANAGE?
Schroders Indonesia offers a wide range of mutual funds with complete asset classes. We currently manage 19 mutual funds consisting of 17 open-ended funds and 2 protected funds. Complete information including documents on mutual funds managed by Schroders Indonesia can be found here.
Money Market Mutual Funds
- Schroder Dana Likuid
- Schroder Dana Likuid Syariah
Fixed Income Mutual Funds
- Schroder Dana Andalan II
- Schroder Dana Mantap Plus II
- Schroder Income Fund
- Schoder Prestasi Gebyar Indonesia II
- Schroder USD Bond Fund
Balanced Mutual Funds
- Schroders Dana Kombinasi
- Schroder Dana Terpadu II
- Schroder Dynamic Balanced Fund
- Schroder Syariah Balanced Fund
Equity Mutual Funds
- Schroder Dana Istimewa
- Schroder Dana Prestasi
- Schroder Dana Prestasi Plus
- Schroder Dana Prestasi Prima
- Schroder 90 Plus Equity Fund
- Schroder Global Sharia Equity Fund (USD)
Protected Mutual Funds
- Schroder Income Plan VI
- Schroder Income Plan VII
We continue to observe market needs to ensure we can offer products that meet investor needs and company capabilities.
DOES SCHRODERS INDONESIA OFFER FOREIGN CURRENCY MUTUAL FUND PRODUCTS?
Yes, currently there are 2 USD denominated products, namely Schroder USD Bond Fund and Schroder Global Sharia Equity Fund (USD).
IS THERE A TAX ON MUTUAL FUNDS?
Mutual fund taxation is imposed at the level of the securities that make up the mutual fund portfolio, so the investment returns for mutual fund investors are not subject to tax. Complete information regarding mutual fund taxation is available in the prospectus of each mutual fund, which can be accessed here.
HOW DO I MONITOR THE PROGRESS OF MY INVESTMENT?
Investors can monitor their investment performance by viewing the percentage increase or decrease in the NAV per unit of the relevant mutual fund from time to time through AKSes KSEI. The NAV itself can be accessed on the Investment Manager's website.
HOW IS THE PERFORMANCE OF EACH MUTUAL FUND MANAGED BY SCHRODERS INDONESIA?
Mutual fund performance and NAV/unit of mutual funds managed by Schroders Indonesia can be seen on the product page and fund factsheet available at the fund center.
WHAT ARE THE COSTS OF INVESTING IN MUTUAL FUNDS?
Fees are charged every time a transaction takes place:
- Subscription fee
- Redemption fee
- Switching fee
The fees charged to the mutual fund and have been calculated in the NAV, so that when the NAV is published, it has taken into account these costs:
- Management fee
- Custodian bank fees
- Other fees (including legal, audit, and other consulting fees).More information about fees can be seen in the mutual fund prospectus and product page which can be accessed at the fund center.
WHO CAN INVEST IN MUTUAL FUNDS?
Both individuals and institutions can invest in mutual funds. To be able to invest in mutual funds, investors can contact investment managers or authorized mutual fund distribution partners of investment managers.
HOW DO I BUY A MUTUAL FUND?
To start investing in mutual funds, investors can contact the investment manager or authorized mutual fund distribution partner of the investment manager. Make sure you read and understand the prospectus before deciding to buy a mutual fund. Also, make sure that the distribution partner and fund manager are reputable and licensed by the Financial Services Authority. The list of Schroders Indonesia mutual fund distribution partners can be found here.
WHO ARE SCHRODERS INDONESIA'S MUTUAL FUND DISTRIBUTION PARTNERS?
Schroders Indonesia collaborates with various banks and online platforms as our distribution partners for mutual funds. You can find the list of our mutual fund distribution partners in Indonesia by visiting the following link.
HOW DO INVESTORS INVEST IN MUTUAL FUNDS MANAGED BY SCHRODERS INDONESIA?
- Determine your investment objectives, investment horizon, and risk profile. This will help you choose the most suitable mutual fund for your needs.
- Visit our website and navigate to the "Fund Center" section. Here, you can find detailed information about the various mutual funds managed by Schroders Indonesia.
- Take the time to read and understand the prospectus of the mutual fund you are interested in. The prospectus contains important information about the fund's investment strategy, objectives, risks, and fees.
- Contact one of our mutual fund distribution partners that work with Schroders Indonesia. You can find the list of our distribution partners at the following link.
- Complete and submit the account opening form (KYC form, risk profile form, and mutual fund subscription form) along with the required documents, to your distribution partner.
- Transfer the amount of money to the designated mutual fund account.
- The purchase of mutual fund participation units (subscription) will be processed on the same day if the required documents and subscription funds are received in the mutual fund subscription account, have been received no later than 13:00 on the bourse day. If past 13.00, it will be processed on the next bourse day.
- Investors will obtain a confirmation of the purchase of mutual fund participation units (subscription) no later than within 7 working days which can be accessed in the KSEI system, specifically through AKSes.KSEI.
- On a monthly basis, investors will receive a monthly statement that provides details of their ownership of mutual fund units. This statement can also be accessed through the KSEI system, specifically through AKSes.KSEI.
- For more detailed information about the procedures for mutual fund subscription, investors should refer to the prospectus of the mutual fund.
WHAT IS THE MINIMUM INVESTMENT AMOUNT IN SCHRODERS MUTUAL FUNDS?
The prospectus of each mutual fund lists the minimum investment amount. However, in general, the minimum investment in mutual funds is quite affordable, some even starting from Rp 10,000. To find the prospectus for Schroders mutual fund products, you can visit the fund center.
HOW TO REDEEM OR SELL THE MUTUAL FUND UNITS MANAGED BY SCHRODERS INDONESIA?
- If you made the purchase (subscribe) through our distribution partner, please contact the distribution partner from whom you subscribe the mutual funds. You can only redeem your mutual fund units through the distribution partner from whom you made the purchase.
- Complete and submit the mutual fund redemption form and required documents to the distribution partner.
- Forms received before 1:00 PM will be processed on the same bourse day. If the form is received after 1:00 PM, it will be processed on the next bourse day.
- You will receive the proceeds from the redemptiom of your investment within 7 working days from the date of processing, transferred to the bank account specified on the transaction form.
- Investors will receive confirmation of the redemption of mutual fund units within a maximum of 7 working days, which can be accessed through the KSEI system (AKSes.KSEI).
- For more detailed information on the procedure for redemption, please refer to the mutual fund prospectus.
HOW CAN I SWITCH MY MUTUAL FUNDS?
You can switch from one mutual fund to another as long as there is a mutual fund switching feature. For more details on the switching procedure, please refer to the mutual fund prospectus.
CAN INVESTORS REDEEM, SUBSCRIBE AND SWITCH ON A DAILY BASIS?
Yes, redemptions, subscriptions, and switching can be done every trading day in accordance with the specified deadlines. Details of redemption, subscription and switching procedures can be found in the mutual fund prospectus.
HOW CAN I FIND OUT THE PARTICIPATION UNITS AND THE VALUE OF MY MUTUAL FUND INVESTMENT?
Investors can do the following:
- If you know the number of units you own, you can multiply it by the NAV/Unit of the fund and you will get the total value of your investment.
- You can contact our distribution partner where you made your mutual fund purchase.You can view your investment details online through the KSEI system (AKSes.KSEI).
HOW CAN I CONTACT SCHRODERS INDONESIA?
Please contact Schroders Indonesia through the Contact Us link on our website or call +62 21 29655100 during office hours, 8.30 am - 5.30 pm.