Edelweiss Mutual Fund announced the launch of the Edelweiss Business Cycle Fund, an open-ended equity scheme following the business cycles-based investing theme.
The scheme opened for public subscription on July 09, 2024, and will close on July 23, 2024. The scheme re-opens for continuous sale and repurchase on August 06, 2024.
This is an open-ended equity scheme following the business cycles-based investing theme. This product is suitable for investors seeking
The investment objective of the scheme is to generate long-term capital appreciation by investing with a focus on riding business cycles through allocation between sectors and stocks at different stages of business cycles in the economy. However, there is no assurance that the investment objective of the scheme will be achieved.
Speaking about the launch, Radhika Gupta, MD & CEO, Edelweiss Mutual Fund said, “The Edelweiss Business Cycle Fund provides investors with a convenient and unique solution by implementing dynamic sector rotations. This strategy effectively addresses the common challenge of timing sector entries and exits, which investors often struggle with. Momentum has been the best-performing factor in India for many years, and when combined with other fundamental factors, it proves highly effective in generating long-term alpha. Investing across various sectors and market caps, this fund offers a robust solution for core allocation with a long-term focus.”
Investors can invest under the scheme with a minimum investment of ₹1000 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:
| Instruments | Indicative Allocation (% of assets) | |
Minimum | Maximum | |
Equity and Equity related instruments of companies selected based on the business cycle theme | 80 | 100 |
Equity and Equity related instruments of companies other than the above companies | 0 | 20 |
Debt and Money Market Instruments including units of debt-oriented mutual fund schemes | 0 | 20 |
Units issued by REITs & InvITs | 0 | 10 |
To date, many asset management companies (AMCs) have launched such business cycle 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 House | Name of the Fund |
HSBC Mutual Fund | HSBC Business Cycle Fund |
HDFC Mutual Fund | HDFC Business Cycle Fund |
ICICI Prudential Mutual Fund | ICICI Prudential Business Cycle Fund |
Axis Mutual Fund | Axis Business Cycles Fund |
Kotak Mahindra Mutual Fund | Kotak Business Cycle Fund |
TATA Mutual Fund | Tata Business Cycle Fund |
Baroda BNP Paribas Mutual Fund | Baroda BNP Paribas Business Cycle Fund |
Union Mutual Fund | Union Business Cycle Fund |
| Source: AMFI (As of July 09, 2024) | |
The scheme performance would be benchmarked against Nifty 500 TRI. The index tracks the broader Indian equity market. Since the scheme’s portfolio will be market-cap agnostic and will be diversified both in terms of sector and number of stocks, the benchmark would be appropriate to compare the performance of the scheme. The AMC/Trustee reserves the right to change the benchmark for evaluation of the performance of the scheme from time to time, subject to SEBI Regulations and other prevailing guidelines if any.
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 also be calculated as under:
Bhavesh Jain, Bharat Lahoti, and Amit Vohra are the designated fund managers of this scheme.
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.
