Scheme Information Document (SID)

A Scheme Information Document (SID) contains all the details about a mutual fund scheme that investors should know before investing. Explore everything about SID in this blog.
EXPLORE FUNDS
What are SID
EXPLORE FUNDS
4 mins
02-May-2024

Investing in mutual funds can be a great way to grow your wealth over time. However, it’s important to understand the risks and benefits of each mutual fund scheme before investing your hard-earned money. One of the most important documents that can help you make an informed investment decision is the Scheme Information Document (SID). In this article, we will discuss what SID is, where investors can find it, and what information it contains.

What is Scheme Information Document (SID)?

Scheme Information Document (SID) is a document that provides investors with all the necessary information about a mutual fund scheme. It includes details such as minimum subscription amounts, exit and entry loads, SIP details, fund managers and their experience, risk level, the scheme’s objective, etc. SID is one of the many fund offer documents and has almost all the information about a mutual fund scheme.

Where can investors find the SID?

SIDs are easily available on Asset Management Company (AMC) websites or any investment platform you pick. For example, on our website, you can find the SID under the “Scheme Documents” section of each mutual fund scheme.

What is contained in a scheme information document?

An SID contains all the necessary information about a mutual fund scheme that an investor should know before investing. Here are some of the key points that are covered in an SID:

  • Investment objective
  • Asset allocation or how much will be invested in which asset
  • Investment strategy and objective
  • Category of the fund; equity or debt
  • Minimum subscription amounts
  • Exit and entry loads
  • SIP details
  • Fund managers and their experience
  • Risk level

Why should you read the SID?

The Scheme Information Document (SID) is a vital resource for mutual fund research because:

  • It elucidates attributes like the scheme objective and asset allocation pattern, aiding in a better comprehension of the scheme's intent and investment strategy.
  • Risk factors can be scrutinised to ascertain whether the scheme aligns with your risk appetite.
  • Details regarding fund managers enable investors to gain insights into the experience and capabilities of those overseeing the scheme.
  • Information on loads, fees, and expense ratios offers a transparent overview of the investment costs involved.
  • Past performance and benchmark details serve as tools for mutual fund analysis (though past performance doesn't guarantee future success).

How to read a scheme information document of mutual fund?

Reading an SID can be overwhelming due to its length and technical jargon. Here are some tips on how to read an SID effectively:

  • Start with the introduction section which explains the aim behind launching a particular scheme.
  • Look for the investment objective which explains how the fund plans to achieve its objective.
  • Check out the asset allocation section which mentions how much will be invested in which asset.
  • Understand the investment strategy and objective.
  • Look for fees and expenses such as exit loads, entry loads, etc.
  • Check out the risk level associated with different aspects of the scheme.

Fees and expenses

Fees and expenses are an important aspect of mutual funds that investors should be aware of before investing. Here are some fees and expenses that are mentioned in an SID:

  • Entry load: The fee charged when an investor purchases units of a mutual fund
  • Exit load: The fee charged when an investor sells units of a mutual fund
  • Expense ratio: The total expense incurred by an AMC to manage a mutual fund scheme

Other mutual fund offer documents

There are two other mutual fund offer documents, details below:

Offer Document

Description

Key Information Document (KIM)

KIM serves as a condensed version of the Scheme Information Document (SID), providing essential scheme details in a shorter format, typically attached with the application form.

Statement of Additional Information

The Statement of Additional Information (SAI) offers comprehensive information beyond the scheme specifics. It includes details about the asset management company (AMC), key personnel, legal matters, financial aspects, and the role of sponsors and trustees.


Conclusion

In conclusion, the SID is the most important document for investors to read when choosing a mutual fund scheme. It includes every detail pertinent to the scheme, and gives you a fair idea of the risks as well as benefits associated with investing in any mutual fund.
 

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Frequently asked questions

What should I look for in a scheme information document?

Here are the key sections to look for in an SID:

  • Highlights and summary: A brief overview of the scheme
  • Introduction: Details about the risks associated with different aspects of the scheme
  • Information about the scheme: This includes asset allocation, investment strategy, category of the fund, etc.
  • Units and offer: Details about the units offered by the scheme
  • Fees and expenses: Information about the costs associated with the scheme
  • Rights of unitholders: Details about the rights of investors
  • Penalties and pending litigation: Information about any penalties or pending legal issues
  • Riskometer
What is a key information memorandum?

Key Information Memorandum (KIM) is like a synopsis of an SID. It provides essential details about a particular scheme. The list below mention some of the points mentioned in the KIM:

  • Scheme information: Name, type, and category of the scheme
  • Investment objective: The primary goal of the scheme
  • Fund manager details: Information about the person managing the fund
  • Asset allocation: Breakdown of where the fund’s assets will be invested
  • Benchmark index: The index against which the fund’s performance will be measured
  • Risk factors: Potential risks associated with the investment
  • Performance details: Past performance of the scheme
  • Load structure: Entry and exit load details
  • Minimum investment amount: The least amount that can be invested
  • Tax implications: Tax treatment of the returns from the scheme.
  • Risk profile
What is a mutual fund factsheet?

A mutual fund factsheet is like a snapshot of the scheme that provides investors with information about its performance history, investment objective, portfolio, industry classification and AUM.

What is the importance of scheme information document?

An SID is essential when choosing which mutual fund to invest money in, as it contains the end-to-end information about the scheme in question. By carefully reading the SID, and comparing the SIDs of various mutual funds against each other, investors can make informed choices about their investments.

Mention what is Statement of Additional Information (SAI)?

The statement of additional information (SAI) is a supplementary document that provides investors with insights into the operations and legal aspects of the mutual fund. It contains additional information about the mutual fund, including details on the asset management company (AMC), sponsors, and trustees. The SAI also includes information on financial and legal matters. The document is not specifically about the scheme but provides information on a larger note. It also mentions names of key persons of the asset management company, registrars, bankers, custodian legal counsel, and auditors. The SAI is a required document to be formalized by a mutual fund company, but it does not need to be sent to prospective investors except upon request.

Who approves the scheme information document prepared by the AMC?

The Scheme Information Documents, prepared by the Asset Management Company (AMC) for a particular scheme, are subject to examination and approval by the Securities and Exchange Board of India (SEBI).

What is SID and SAI in mutual fund?

SID stands for Scheme Information Document (SID), which provides detailed information about a mutual fund scheme, including its objectives, investment strategy, risk factors, and terms. SAI stands for Statement of Additional Information (SAI), which offers supplementary details beyond the scheme specifics, such as information about the asset management company (AMC), key personnel, legal matters, and financial aspects.

Is SAI legally a part of SID?

Yes, Statement of Additional Information (SAI) is legally a part of the Scheme Information Document (SID).

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Disclaimer:

Bajaj Finance Limited ("BFL") is registered with the Association of Mutual Funds in India ("AMFI") as a distributor of third party Mutual Funds (shortly referred as 'Mutual Funds) with ARN No. 90319

BFL does NOT:

(i) provide investment advisory services in any manner or form:

(ii) carry customized/personalized suitability assessment:

(iii) carry independent research or analysis, including on any Mutual Fund schemes or other investments; and provide any guarantee of return on investment.

In addition to displaying the Mutual fund products of Asset Management Companies, some general information is sourced from third parties, is also displayed on As-is basis, which should NOT be construed as any solicitation or attempt to effect transactions in securities or the rendering any investment advice. Mutual Funds are subject to market risks, including loss of principal amount and Investor should read all Scheme/Offer related documents carefully. The NAV of units issued under the Schemes of mutual funds can go up or down depending on the factors and forces affecting capital markets and may also be affected by changes in the general level of interest rates. The NAV of the units issued under the scheme may be affected, inter-alia by changes in the interest rates, trading volumes, settlement periods, transfer procedures and performance of individual securities forming part of the Mutual Fund. The NAV will inter-alia be exposed to Price/Interest Rate Risk and Credit Risk. Past performance of any scheme of the Mutual fund do not indicate the future performance of the Schemes of the Mutual Fund. BFL shall not be responsible or liable for any loss or shortfall incurred by the investors. There may be other/better alternatives to the investment avenues displayed by BFL. Hence, the final investment decision shall at all times exclusively remain with the investor alone and BFL shall not be liable or responsible for any consequences thereof.

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Disclaimer on Risk-O-Meter:

Investors are advised before investing to evaluate a scheme not only on the basis of the Product labeling (including the Riskometer) but also on other quantitative and qualitative factors such as performance, portfolio, fund managers, asset manager, etc, and shall also consult their Professional advisors, if they are unsure about the suitability of the scheme before investing.