Cornerstone Total Return Fund: Unique Closed-End Fund with Dividend Reinvestment Plan

Cornerstone Total Return Fund (CRF) is a closed-end fund that offers a unique dividend reinvestment plan, allowing investors to reinvest dividends at the fund's net asset value (NAV). This makes CRF one of the few funds that can benefit from compounding at the premium thresholds. The fund's unique structure and features make it an attractive option for investors looking for a unique investment opportunity.

Fintech companies such as PhonePe, Paytm, BharatPe, and Cred have recently expanded their secured lending services by offering instant loans against mutual funds. This move leverages the fully digital nature of securities in India, allowing investors to pledge their mutual funds as collateral to access credit quickly.

The new product, known as loans against mutual funds (LAMFs), enables investors to meet short-term funding needs without liquidating their mutual funds. Instead, they can continue to stay invested through systematic investment plans (SIPs). This model is made possible by the advanced technology stacks employed by fintechs, which facilitate real-time transactions that would have taken weeks just a few years ago Fintechs expand secured lending with instant loans against mutual funds^[1].

The LAMF model offers several benefits. Firstly, it allows investors to access credit at lower capital costs. Secondly, it provides a convenient way to meet immediate funding needs without disrupting long-term investment strategies. Lastly, it showcases the innovation and technological prowess of fintech companies in the Indian market.

The expansion of secured lending services by fintechs is a significant development in the financial sector. It not only caters to the immediate funding needs of investors but also promotes financial inclusion by providing access to credit for those who might not have traditional banking relationships.