NFO NEST
May 2011

Spiced Up!

The aroma of spices is flooding the NFO market. Variety is the spice of the NFO market. Akin to NFOs in April 2011, four funds from diverse categories make their appearance in the May 2011 NFO NEST.

Sundaram Equity Plus Fund
Opens: May 4, 2011
Closes: May 18, 2011

Taking advantage of the love Indians have for gold, Sundaram Mutual Fund has launched Sundaram Equity Plus, a fund that would invest in a mix of stocks and gold. The fund is an open-end scheme, which will invest between 65% and 85% in equity and a maximum of 15% to 35% in gold exchange traded funds (ETFs). The fund is the first of its kind to offer a mix of equities and gold. The scheme will primarily focus on opportunities in Indian equities with the addition of gold ETF to provide diversification and exposure to the yellow metal in certain phases. The equity portion of the fund will be invested primarily in large caps, benchmarking itself to the Nifty. Given the fact that the Indian economy is expected to grow at 8% for the next few years, and India's attractiveness amongst emerging markets, equities are expected to do well over the long term. Gold, on the other, has been shining in recent times. It has outperformed other asset classes such as equity and debt over one-year as well as 10-year periods. The performance of the scheme shall be benchmarked to the S&P CNX Nifty index for the equity and equity- related investments (65% of the portfolio) and to the price of Gold in INR terms for the rest of the portfolio i.e. 35%. The fund manager for the scheme will be Srividhya Rajesh and S Bharath.

Birla Sunlife Capital Protection-oriented Fund – Series 6
Opens: May 18, 2011
Closes: May 30, 2011

Birla Sun Life Mutual Fund has launched Birla Sun Life Capital Protection Oriented Fund - Series 6, a close-ended capital protection oriented scheme with the duration of 761 days from the date of allotment of units. The investment objective of the scheme is to provide capital appreciation linked to equity market with downside protection at the end of the tenure. The fund expects to achieve down side protection by investing in debt securities with tenure comparable with the tenure of the plan, subject to the credit risk. The fund expects to achieve the market-linked appreciation (upside) by investing in premium of exchange traded options. The fund proposes to restrict its derivative exposure only to the extent of buying of call options. Hence the maximum loss could be equivalent to the premium paid, not any more. Moreover, the premium paid will be equal or lower to the coupon receivable from fixed income securities after providing for fund expenses. The scheme would allocate 80% to 100% of assets in debt securities and money market instruments and up to 20% of assets in options premium with high risk profile, but limited to the premium paid. Benchmark Index for the scheme will be CRISIL Balanced Fund Index. The fund manager for the scheme will be Satyabrata Mohanty and Ajay Garg.

ICICI Prudential Multiple Yield Fund - Plan A
Opens: May 20, 2011
Closes: May 31, 2011

ICICI Prudential Mutual Fund has launched a new close-ended income fund - ICICI Prudential Multiple Yield Fund Plan A. The tenure of the plan is 1100 days. The investment objective of the scheme is to generate returns by investing in a portfolio of fixed income securities/ debt instruments. The performance of the scheme will be benchmarked against Crisil MIP Blended index and will be managed by Mr. Chaitanya Pande.

Union KBC Equity Fund
Opens: May 20, 2011
Closes: June 3, 2011

Union KBC Equity Fund, an open ended equity scheme, is the maiden launch by Union KBC Mutual Fund. The investment objective of the scheme is to achieve long-term capital appreciation by investing substantially in a portfolio consisting of equity and equity related securities. The scheme would allocate 75% to 100% of assets in equity and equity related instruments including equity linked derivatives with medium to high risk profile. On the other side, it would allocate upto 25% of assets in debt and money market instruments with low to medium risk profile. Benchmark Index for the scheme is BSE 100. Ashish Ranawade will be the fund manager for the scheme.

Axis Gold Fund, Union KBC Liquid Fund, Religare Gold Fund, DSP Blackrock World Agriculture Fund, DSP Blackrock Latin American Fund, DSP Blackrock New Energy Fund, HDFC Gold Fund, DSP Blackrock China Fund, L & T Capital Protection Oriented Fund – Series I, II, and III, Sundaram Capital Protection-oriented Fund 3 years- Series 4,5 and 6, Axis Metal ETF, Axis FMCG ETF, Axis Banking ETF, Axis Energy ETF, Smallcap Benchmark Exchange Traded Fund, SBI Gold Fund, SBI Capital Protection-oriented Fund – Series III, Baroda Pioneer Dynamic Bond Fund, and Baroda Pioneer Credit Opportunities Fund are expected to be launched in the coming months.