2.1.12 Fund Formula Setup

This topic provides information on fund formula setup button.

This fund rule is an optional one that facilitates the definition of mathematical expressions and factors that will be used in computation of any of the components in the NAV, Transaction Base Prices, etc.

  1. Click Fund Formula Setup button from the Fund Rules Detail screen.
    The Fund Formula Setup screen is displayed.

    Figure 2-30 Fund Formula Setup


    Description of Figure 2-30 follows
    Description of "Figure 2-30 Fund Formula Setup"

    Before you set up a Fund Load mapping profile record for a fund, it is desirable to ensure that the following information is already setup in the system:

    • The fund already has an existing, unauthorized Fund Demographics profile record.
    • The fund already has an existing, unauthorized Shares Characteristics profile record.
    • The fund already has an existing, unauthorized Transaction Processing Rules profile record.
  2. On Fund Formula Setup screen, specify the fields.
    For more information on fields in the screen, refer the below table.

    Table 2-53 Fund Formula Setup

    Fields Description
    Fund ID Display

    This field indicates the ID fund for which you are setting up the Fund Formula. This information is defaulted from the Fund Demographics screen.

    Rule Effective Date Display

    The Rule Effective Date for the fund, which you specified in the Fund Demographics screen, is displayed here.
    Used for Fund Price Computation Mandatory

    Select Yes from drop-down list if the rule is for fund price computation or not.

    Fund Formula Section

    Table 2-54 Fund Formula Setup

    Field Description
    Component ID Alphanumeric; 10 Characters; Mandatory

    Specify the component of the fund price, for which an expression is being defined for computation, by selecting any one of the Component ID’s, from the list given. This is an Alphanumeric ID that is used to build the fund formula.

    The component could be one of the standard price bases such as the Net Asset Value or Transaction Base Prices; or an additional price basis such as Offer Price, Bid Price, Price Before Performance, Price After Performance and so on. These additional price bases are built on the appropriate parent standard price bases.

    For instance, the additional price basis Offer Price could have the standard price basis TBP02 as its parent.

    Additional price bases can be defined only if multiple price bases are allowed as indicated in the General Operating Rules for the fund.

    If multiple price bases are defined, you must also indicate the applicable inherent fees or incentives.
    Component Type Alphanumeric; 5 Characters; Mandatory

    Specify the component type. Alternatively, you can also select component type from the option list.

    • User Entered: indicates that the user enters the value.
    • Default: indicates that there is a specified default value, which can be edited.
    • Formula: indicates the component value is computed as per this formula, based on other Component ID’s
    • Constant: indicates a fixed value that cannot be changed.
    Component Description Alphanumeric; 50 Characters; Mandatory

    Enter any text message or remark regarding the formula. This is a free format text.

    Formula Alphanumeric; 255 Characters; Optional

    When Formula is selected as the Component Type, then this field becomes mandatory. Any text or value entered here should be equal to the result of the formula. When Formula is not selected as the Component Type, then this field becomes unavailable for data entry.

    Fluctuation(%) Numeric; 5 Characters; Optional

    You can specify the fluctuation allowable in the additional components (typically tax components) for the transaction type, for the fund. When prices are entered for the transaction type for the fund, for the day, the system validates whether the fluctuation is within the allowable limit specified in this field.
    Default Value Numeric; 22 Characters; Optional

    Specify the data value.

    Price Basis Mandatory

    If multiple price bases are allowed as indicated in the General Operating Rules for the fund, you can use this field to indicate whether price bases other than the NAV and Transaction Base Prices are being specified for computation of the fund price component, using the formula specified.

    For the NAV and Transaction Base Price components, the Yes option is defaulted in this field and cannot be changed. For additional components, you can select Yes to indicate additional bases, or No if no additional bases are being used in the formula.

    Parent Basis Alphanumeric; 10 Characters; Optional

    For components used for additional price bases, specify the standard price basis from which the additional price basis derives, in this field. You can select either the NAV or the Transaction Base Price as the parent price basis. NAV can be chosen as the parent price basis only for NAV components.

    Additional price bases can only be defined if allowed for the fund in the General Operating Rules.

    For components used for standard price bases such as NAV and Transaction Base Price, the parent price basis is defaulted to the component itself.
    Inherent Fee Numeric; 22 Characters; Optional

    If multiple price bases are defined, you must also indicate the applicable inherent fee in this field. You can use the Find link to select the applicable loads. The selection list displays loads tagged as Price Basis Loads in the Load Definition.

    For Transaction Base Prices, the inherent fee / incentive cannot be parameterized.

    Note: Any loads that have been defined as price basis loads are only used as the indicator for computing load values, and are not picked up during evaluation of criteria. That is, the other load details specified for such loads, such as the return value, slabs and so on, are not taken into consideration. The difference between the Transaction Base Price and the Price Basis defined for the transaction is considered as an inherent fee or incentive, during allocation.

    For instance, if the Price Basis for a transaction is Offer Price, and Transaction Base Price is 1.009 and the Offer Price is 1.060, the difference (1.06-1.009 = 0.051, without currency rounding) is considered as the inherent fee (since the TBP is less than the offer price). If the offer price were less than the TBP, the difference between the two is considered an inherent incentive.

    Inherent Incentive Numeric; 5 Characters; Optional

    If multiple price bases are defined, you must also indicate the applicable inherent incentive loads in this field.
    Exclude Mandatory

    Select Yes option from drop-down list indicate that the selected price component must be excluded from capital gains computation. This specification can only be made for the user entered components.

    This feature is only available if your installation has specifically requested for it.
    Default Mandatory

    For each of the standard price basis components that are used as parent price bases, (that is, the NAV and the Transaction Base Prices) you must assign one default price basis value. Check this box to default price basis value.

    For instance, you have defined the components Offer Price 1 and 2, with the parent price basis TBP02. You must choose either Offer Price 1 or 2 as the default price basis value for TBP02.
  3. Click Compute button to compute the fund price.

Parent topic: Fund Rule