Monday, October 20, 2008

NFO Nest
(October 2008)

NFOs go abegging…

Domestic fund houses are finding it difficult to get investors for their newly-launched schemes. Players like ICICI Prudential and Principal are extending the last date of their NFOs. This development has come at a time when the mutual fund industry was already grappling with a reduction in funds raised from new fund offers - for instance, during the June 2008 quarter, 146 new schemes raised Rs 29,799 crore, while a year earlier, 162 schemes raised Rs 38,653 crore, according to data gathered from the industry body AMFI. However, some of the fund houses like IDFC Mutual Fund and Bharathi AXA are putting a brave face. We are witnessing signs of a drying up of liquidity in the market given tax payments and other external factors.

The following funds find their place in the NFO Nest in October, 2008.

Principal Emerging Bluechip Fund
Opens: 22 Sept 2008 Closes: 20 Oct, 2008

It takes the brave to do something different and tread on the path less taken. And Principal Mutual Fund is one such brave fund house that has decided to swim against the tide. The AMC has launched the Principal Emerging Bluechip Fund
that aims to invest in stocks of mid- and small-cap companies, and that too in a highly volatile market scenario where the mid- and small-caps are suffering the most. The fund will allocate 65-95 per cent of its corpus in equity and equity-related instruments of mid-cap companies, 5-15 per cent in equity and equity-related instruments of small-cap companies and up to 30 per cent in equity and equity related instruments of companies other than mid-cap and small-cap. While the fund aims to allocate 70-100 per cent in equity, up to 30 per cent allocation will be towards cash and money market instruments including fixed income securities. The fund will be benchmarked against the CNX Midcap Index.

DWS Gilt Fund
Opens: 7 Oct, 2008 Closes: 21 Oct, 2008

Deutsche Mutual Fund has launched DWS Gilt Fund, an open-ended gilt fund. The investment objective of the scheme is to generate reasonable returns by investing in Central/ State Government securities of various maturities. The scheme offers two plans viz. regular and institutional plan with dividend payout and growth option. The minimum investment amount under regular plan is Rs. 5,000 and under institutional plan it is Rs. 50 lakh. The fund will charge no entry load under both regular and institutional plan. The regular plan will charge 1 per cent exit load if redeemed before 12 months. The fund will be managed by Mr. Nitish Gupta and is benchmarked against I – Bex.

Goldman Sachs Sustain Fund, UTI Wealth Builder Fund Series II, Edelweiss Gilt Fund, Birla Sun Life 130 30 Fund, Religare Aegon Liquid Fund, Religare Aegon Liquid Plus Fund, ICICI Prudential R.I.G.H.T (Rewards of Investing and Generation of Healthy Tax Savings) Fund, Fidelity European Dynamic Growth Fund and Fidelity Global Industrial and Natural Resources Fund are expected to be launched in the coming months.

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