diff --git a/cmd/helm/init.go b/cmd/helm/init.go
index bafe5231f..a14d945a2 100644
--- a/cmd/helm/init.go
+++ b/cmd/helm/init.go
@@ -21,6 +21,7 @@ import (
 	"fmt"
 	"io"
 	"os"
+	"path/filepath"
 
 	"github.com/spf13/cobra"
 	apierrors "k8s.io/apimachinery/pkg/api/errors"
@@ -299,7 +300,7 @@ func ensureDefaultRepos(home helmpath.Home, out io.Writer, skipRefresh bool) err
 		if err != nil {
 			return err
 		}
-		lr, err := initLocalRepo(home.LocalRepository(localRepositoryIndexFile), home.CacheIndex("local"), out)
+		lr, err := initLocalRepo(home.LocalRepository(localRepositoryIndexFile), home.CacheIndex("local"), out, home)
 		if err != nil {
 			return err
 		}
@@ -330,16 +331,14 @@ func initStableRepo(cacheFile string, out io.Writer, skipRefresh bool, home helm
 		return &c, nil
 	}
 
-	// In this case, the cacheFile is always absolute. So passing empty string
-	// is safe.
-	if err := r.DownloadIndexFile(home.String()); err != nil {
+	if err := r.DownloadIndexFile(home.Cache()); err != nil {
 		return nil, fmt.Errorf("Looks like %q is not a valid chart repository or cannot be reached: %s", stableRepositoryURL, err.Error())
 	}
 
 	return &c, nil
 }
 
-func initLocalRepo(indexFile, cacheFile string, out io.Writer) (*repo.Entry, error) {
+func initLocalRepo(indexFile, cacheFile string, out io.Writer, home helmpath.Home) (*repo.Entry, error) {
 	if fi, err := os.Stat(indexFile); err != nil {
 		fmt.Fprintf(out, "Adding %s repo with URL: %s \n", localRepository, localRepositoryURL)
 		i := repo.NewIndexFile()
@@ -348,7 +347,12 @@ func initLocalRepo(indexFile, cacheFile string, out io.Writer) (*repo.Entry, err
 		}
 
 		//TODO: take this out and replace with helm update functionality
-		os.Symlink(indexFile, cacheFile)
+		fp, err := filepath.Rel(cacheFile, indexFile)
+		if err != nil {
+			return nil, err
+		}
+		pth := home.Path(fp)
+		os.Symlink(pth, cacheFile)
 	} else if fi.IsDir() {
 		return nil, fmt.Errorf("%s must be a file, not a directory", indexFile)
 	}