NFO Alert: Mahindra Manulife Mutual Fund launches Mahindra Manulife Multi Asset Allocation Fund; all you need to know

Mahindra Manulife Mutual Fund announced the launch of the Mahindra Manulife Multi Asset Allocation Fund. The scheme opened for public subscription on February 20, 2024, and will close on March 05, 2024. The scheme reopens for continuous sale and repurchase on March 15, 2024.

What kind of mutual fund scheme is this?

This is an open-ended scheme investing in equity, debt, gold/silver ETFs, and exchange-traded commodity derivatives. This product is suitable for investors seeking

• Capital appreciation while generating income over the long term
• Investments across equity and equity-related instruments, debt and money market instruments, units of gold/silver ETFs, and exchange-traded commodity derivatives.

What is the main objective of investing in this fund?

The objective of the scheme is to achieve a balance between risk and reward by allocating investments across designated asset classes. Additionally, it provides investors with the advantage of long-term capital gains (LTCG) taxation, along with the benefits of indexation.

Highlighting the significance of this offering, Anthony Heredia, MD & CEO, Mahindra Manulife Investment Management said, “We are excited to announce the launch of our multi-asset allocation fund, which is a product that every investor may have in their portfolio. Markets will always present opportunities along with challenges, and diversification between asset classes done thoughtfully is one of the best ways to make the best of the opportunity, without losing sight of risk. The Mahindra Manulife Multi Asset Allocation Fund presents an opportunity for investors to access multiple asset classes within one product, including equity, debt and gold/silver ETFs.”

How may one invest in this scheme?

Investors can invest under the scheme with a minimum investment of ₹500 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:

Are there similar mutual funds in the market?

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

How will the scheme benchmark its performance?

The scheme performance would be benchmarked against the 45% NIFTY500 TRI + 40% - CRISIL Composite Bond Index + 10% - Domestic Price of Physical Gold + 5% Domestic Price of Silver (First Tier Benchmark).

Performance comparisons for the scheme will be made vis-à-vis the aforesaid Benchmark. However, the scheme’s performance may not be strictly comparable with the performance of the benchmark due to the inherent differences in the construction of the portfolios. The benchmark is a composite of the asset classes in which the Scheme seeks to invest. The weights are in line with the expected long-term range of average holdings in the portfolio of each asset class.

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” charged would be calculated as under:

• An exit load of 0.5% is payable if units are redeemed/switched out up to three months from the date of allotment.
• Nil if units are redeemed/switched out after three months from the date of allotment.

Who will manage this scheme?

Renjith Sivaram Radhakrishnan oversees equity management, Rahul Pal handles debt, and Pranav Nishith Patel manages dedicated overseas investments in the scheme.  

Does the fund contain any inherent risk?

The scheme involves “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 high risk only. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.