The new fund offer or NFO of the scheme is open for subscription and it will close on February 22. The scheme will re-open for continuous sale and repurchase on February 28.
The investment objective of the scheme is to generate income/long-term capital appreciation by investing in equity, equity derivatives, and fixed-income instruments. The allocation between equity instruments and fixed income will be managed dynamically to provide investors with long-term capital appreciation while managing downside risk.
The scheme will be benchmarked against the CRISIL Hybrid 50+50 Moderate Index and will be managed by Rajeev Thakkar, Raunak Onkar, Raj Mehta, Rukun Tarachandani, and Mansi Kariya.
It will invest 0-100% in equity and equity derivatives, 0-100% in debt securities, and money market instruments including units of debt-oriented mutual fund schemes.The minimum application amount is Rs 5,000 and any amount thereafter, while the minimum application amount for additional purchase is Rs 500 and any amount thereafter.The minimum application amount for monthly SIP is Rs 1,000 and the minimum application amount for quarterly SIP is Rs 3,000 and any amount thereafter. The scheme will offer direct and regular plans both with growth and IDCW options.For equity portfolio, the stock selection process proposed to be adopted by the fund manager will be generally a bottom-up approach seeking to identify companies with a long-term sustainable competitive advantage (as this is one of the key factors responsible for withstanding competitive pressures and does not allow rivals to eat up any excess profits earned by a successful business).
For the debt portfolio, the fund manager will seek to play out the yield curve and exploit anomalies if any in portfolio construction after analysing the macro-economic environment including the future course of system liquidity, interest rates, and inflation along with other considerations in the economy and markets.
The scheme is suitable for investors who are seeking capital appreciation and income generation over the medium to long term and looking for investment in equity and equity-related instruments as well as debt and money market instruments, while managing risk through active asset allocation.
The principal invested in the scheme will be at “moderate” risk according to the riskometer of the scheme. The principal invested in the benchmark will be at “high” risk according to the riskometer of the benchmark.
“With the changes in the debt taxation laws, our conservative hybrid fund lost the indexation benefit. So today conservative hybrid fund will be taxed at the full marginal rate of the investor. So there is a clear gap in our portfolio offering or the product offering on such a product and there is a big demand from our unitholders and our distribution partner that they needed a product from our fund house which will give us this indexation benefit,” said Neil Parag Parikh, Chairman & CEO, PPFAS Mutual Fund, adding that this dynamic asset allocation fund will give indexation benefits if held for more than three years, he added.
“The allocation of the fund or the equity allocation of the dynamic asset allocation fund will be between 35% and 65% to get the indexation benefits. But from our side, the equity allocation will actually be at the lower end. It will mainly be static at about 35-40% equity and this will be a combination of long equity positions which will have strong cash flows as well as cash to futures arbitrage. So please consider this fund for your debt allocation, not consider the Thai fund for your equity allocation,” Parikh added.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
