Axis Mutual Fund aims to raise Rs 50 crore from new ETF fund of funds
Unlike a regular mutual fund that invests in distinct asset classes, a fund of funds invests in schemes of its own or other fund houses.
Axis Mutual Fund, the seventh largest fund house, is looking to raise at least Rs 50 crore from a new fund offer during the primary subscription period of March 22-April 5. The open-ended S&P 500 ETF fund of funds will invest in exchange-traded funds replicating the S&P 500 index.
Vinayak Jayanath will be managing the fund, which will carry an exit load of 25 bps if redeemed/switched out within 30 days from the date of allotment, and no exit load if redeemed/switched out within 30 days of allotment, Raghav Iyengar, who is the chief business development officer at the fund house said, adding they hope to collect at least Rs 50 crore during the fund offer period.
Unlike a regular mutual fund that invests in distinct asset classes, a fund of funds invests in schemes of its own or other fund houses. In the case of international fund of funds, the fund manager invests in units of offshore mutual funds by ensuring that the target fund's investment philosophy and risk profile match with that of the fund's mandate.
By investing in a fund of funds, which offers asset diversification, investors may also benefit from lower risks as it follows a passive investment strategy.
Chandresh Nigam, the outgoing managing director of Axis AMC said ETFs are becoming popular amongst the various vehicles of investing in passive strategies in the country, where a fund of funds can be considered as an interesting entry point for investors with a longer investment horizon and who wish to diversify their portfolio from a global standpoint. By launching this fund of funds, we are enabling global exposure through passive strategies.
Also Read: Could Federal Reserve rate action jolt gold price today? Here's what experts suggest
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
RECOMMENDED STORIES
Power of Compounding: How many years will it take to reach Rs 3 crore corpus if your monthly SIP is Rs 4,000, Rs 5,000, or Rs 6,000
Power of Compounding: Salary Rs 25,000 per month; is it possible to create over Rs 2.60 crore corpus; understand it through calculations
Reduce Home Loan EMI vs Reduce Tenure: Rs 75 lakh, 25-year loan; which option can save Rs 25 lakh and 64 months and how? Know here
Top 7 Large and Mid Cap Mutual Funds with Best SIP Returns in 5 Years: No. 1 fund has turned Rs 15,000 monthly SIP investment into Rs 20,54,384; know about others
New Year Pick by Anil Singhvi: This smallcap stock can offer up to 75% return in long term - Check targets
PSU Oil Stocks: Here's what brokerage suggests on these 2 largecap, 1 midcap scrips - Buy, Sell or Hold?
07:33 PM IST