Monday, September 17, 2012


September 2012

Fixed Maturity Plans (FMPs) have been an asset gathering tool for many fund houses in volatile times in equity markets. However, they went off radar as financial markets started expecting a cut in key interest rates a few months back. FMPs are back after a lull of almost a month when the Reserve Bank of India in its monetary policy review maintained 'status quo' in the key interest rates on July 30, 2012.

There is a sole hybrid capital protection-oriented NFO amidst the deluge of FMPs in the September 2012 NFO NEST.

Union KBC Capital Protection-oriented Fund – Series 1

Opens: September 3, 2012
Closes: September 17, 2012

Union KBC Capital Protection-oriented Fund - Series 1, a close ended capital protection oriented fund, will have a duration of three years from the date of allotment. The investment objective of the fund is to seek capital protection by investing in fixed income securities maturing on or before the tenure of the fund and seeking capital appreciation by investing in equity and equity related instruments. The fund would allocate 83% to 100% of assets in debt and money market instruments with low to medium risk profile and up to 17% in equity and equity related instruments with low risk profile. Of the investments in debt instruments, up to 5% of assets would be invested in AAA/A1+ rated certificate of deposits, up to 5% in AAA/A1+ rated commercial papers, 95% to 100% in AAA/A1+ rated non-convertible debentures, and 5% in CBLO. By investing a majority of the funds in highly rated debt and money market instruments, the scheme aims to protect the capital at the time of maturity. The remaining proportion of the funds will be invested in equity and equity related instruments, which may generate a positive return on the initial investment and grow the money. This fund is open for investment to individual and non-individual investors and is ideal for investors who do not want to take a major risk on their invested capital but would like exposure to equities. It is also aimed at first time mutual fund investors who have traditionally only invested in fixed income instruments, but would like to participate in the returns offered by the Indian equity markets. CRISIL MIP Blended Fund Index is the Benchmark Index for the fund. Ashish Ranawade and Parijat Agrawal will be the fund managers.

IDBI Balanced Fund, Goldman Sachs Gold Fund of Fund, SBI Gsec Fund, BNP Paribas India Consumption Fund, Reliance Retirement Fund, Franklin Templeton India Allocation Fund, Union KBC Asset Allocation Fund, Reliance Infrastructure Debt Fund, Religare Bank Debt Fund, ICICI Prudential Cash Management Fund, UTI Regular Income Fund, JP Morgan India Focus Fund, Sundaram Dynamic Bond Fund, JP Morgan India Low Duration Fund, JP Morgan India Medium Term Bond Fund, ICICI Prudential Multiple Yield Fund, IDBI Debt Opportunities Fund, and IDBI CD Liquid Fund are expected to be launched in the coming months.

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