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Business News/ Money / Personal Finance/  NFO Alert: ITI Mutual Fund launches Focused Equity Fund; all you need to know
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NFO Alert: ITI Mutual Fund launches Focused Equity Fund; all you need to know

ITI Mutual Fund announced the launch of the ITI Focused Equity Fund. The scheme opened for public subscription on May 29, 2023, and will close on June 12, 2023.

ITI Mutual Fund announced the launch of the ITI Focused Equity FundPremium
ITI Mutual Fund announced the launch of the ITI Focused Equity Fund

ITI Mutual Fund announced the launch of the ITI Focused Equity Fund, an open-ended equity fund scheme investing in a maximum of 30 stocks across market capitalization.

The scheme opened for public subscription on May 29, 2023, and will close on June 12, 2023. The scheme re-opens for continuous sale and repurchase on or before June 23, 2023.

Q. What kind of mutual fund scheme is this?

This is an open-ended focused equity fund scheme suitable for investors looking for long-term capital appreciation. The fund would invest the money in a concentrated portfolio of equity and equity-related instruments of up to 30 companies across various market caps, thus, allowing investors the benefits of putting their money in large-cap, mid-cap, and small-cap stocks.

Q. What is the main objective of investing in this fund?

The investment objective of the scheme is to seek to generate long-term capital appreciation through investing in a concentrated portfolio of equity and equity-related instruments of up to 30 companies across market capitalization. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved.

Q. How may one invest in this scheme?

Investors can invest under the scheme with a minimum investment of Rs 5000 per plan/option and in multiples of Re 1. There is no upper limit for investment.

Under normal circumstances, the asset allocation of the scheme will be as follows:

InstrumentsIndicative Allocations (% of total assets)Risk Profile
MinimumMaximum
Equity and Equity Related Instruments (of not exceeding 30 companies across market capitalization)65%100%High
Listed Preference Shares0%10%Medium to High
Debt and Money Market Instruments 0%35%Low to Medium
Units issued by REITs and InvITs 0%10%Medium to High

Q. Are there similar mutual funds in the market?

To date, many asset management companies (AMCs) have launched such focused equity funds, thus, allowing inclined investors to avail of returns corresponding to the total returns of the securities in this particular index. These include:

Mutual Fund HouseName of the Fund
HDFC Mutual Fund HDFC Focused 30 Fund 
ICICI Prudential Mutual FundICICI Prudential Focused Equity Fund
TATA Mutual FundTata Focused Equity Fund
Franklin Templeton Mutual FundFranklin India Focused Equity Fund 
SBI Mutual Fund SBI Focused Equity Fund 
Kotak Mahindra Mutual Fund Kotak Focused Equity Fund 
Axis Mutual Fund Axis Focused 25 Fund 
Quant Mutual Fund Quant Focused Fund
Nippon India Mutual Fund Nippon India Focused Equity Fund
Baroda BNP Paribas Mutual FundBaroda BNP Paribas Focused Fund 
Source: MoneyControl

Q. How will the scheme benchmark its performance?

The performance of the scheme will be benchmarked with the Nifty 500 TRI (Total Return Index). The same has been chosen as the benchmark as the asset allocation pattern of the benchmark is in conformity with the declared asset allocation pattern of the scheme. The index has exposure across market capitalization (large caps, midcaps, and small caps) and across sectors.

The fund also intends to seek exposure across market capitalizations (large caps, midcaps, and small caps) and across sectors. Since the fund is a focused fund and will have concentrated portfolio holdings, considering the liquidity and volatility of the portfolio, the fund will have a large part of portfolio holdings which may be part of the Nifty 500 TRI.

Q. Are there any entry or exit loads to this scheme?

This scheme involves no “Entry Load", which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load" would be calculated as under:

- 1% if redeemed or switched out on or before completion of 12 months from the date of allotment of units;

- Nil, if redeemed or switched out after completion of 12 months from the date of allotment of units.

Q. Who will manage this scheme?

The fund will be managed by Dhimant Shah and Rohan Korde. Further, Tanay Gabhawala is the dedicated fund manager for making overseas investments as permitted under the Regulations, guidelines and circulars issued from time to time.

Q. Does the fund contain any inherent risk?

The scheme involves “Very High Risk" as per the details mentioned in the Scheme Information Document and is best suited to investors willing to understand that their principal will be subject to very high risk only. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.

 

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Published: 29 May 2023, 01:52 PM IST
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