NFONEST

July 2020

After a lone New Fund Offer (NFO) made its appearance in June 2020, July 2020 has just two NFOs open in view of the ongoing COVID-19 pandemic.

Motilal Oswal Multi Asset Fund

Opens: July 15, 2020

Closes: July 27, 2020

Motilal Oswal Mutual Fund has launched Motilal Oswal Multi Asset Fund, an open ended fund that will invest across three asset classes – equity, debt, gold. The fund aims to generate long term capital appreciation by investing in a diversified portfolio comprising equity, international equity index funds/equity ETFs, debt and money market instruments and gold exchange traded funds. The fund will invest 10-50 per cent in equity, international equity index funds and equity ETFs, 40-80 per cent in debt, money market instruments and 10-20 per cent in Gold ETF. Debt and money market instruments will be in AAA papers with a 3-5 year average maturity. Different asset classes react differently to business cycles, changes in economy and geo-political realities and hence have different levels of risk. Allocating funds solely to a single asset class is not prudent as it is prone to behave inconsistently, go through its own cycles and may not garner efficient inflation and risk adjusted returns. Asset allocation tries to balance the risk by dividing assets among investment vehicles. Low correlation among different asset classes provides the portfolio with an effective hedge in lowering the volatility of the portfolio. The benchmark for the fund will be 30% Nifty 50 TRI + 50 % Crisil Short Term Gilt Index + 10% Domestic Price of Gold + 10% S&P 500 Index (TRI). The fund will be managed by Mr Siddharth Bothra, Mr Abhiroop Mukherjee, Mr Herin Visaria and Mr Swapnil Mayekar. 

Mirae Asset Banking and PSU Debt Fund

Opens: July 8, 2020

Closes: July 20, 2020

Mirae Asset has launched Mirae Asset Banking & PSU Debt Fund. It is an open ended debt scheme predominantly investing in debt devices of banks, public sector undertakings, public monetary establishments and municipal bonds. According to SEBI, a banking & PSU fund is an open ended debt scheme which has to speculate not less than 80% of its belongings in debt devices of banks, public sector undertakings and public monetary establishments. The scheme seeks to have increased Allocation in AAA rated devices. The scheme proposes to usually keep a portfolio length of two to five years with use of G-sec to shift length. Mirae Asset Banking & PSU Fund will be benchmarked against NIFTY Banking and PSU Debt Index. The scheme will be managed by Mahendra Jajoo.