Wednesday, August 26, 2009

HDFC MF to launch Short Term Opportunities Fund

HDFC Mutual Fund has filed an offer document with securities and exchange board of India (SEBI) to launch HDFC Short Term Opportunities Fund, an open-ended income scheme.

The new fund offer (NFO) price for the scheme is Rs 10 per unit.

Investment objective:
The investment objective of the scheme is to generate regular income through investments in debt / money market instruments and government securities with maturities not exceeding 30 months.

Plan:
The scheme offers growth and dividend option. Dividend option offers sub-option with payout and re-investment facility.

Asset allocation:
The scheme will invest 60% to 100% of asset in debt and money market instruments including securitized debt, with a risk profile of low to medium. Investments in securitized debt, if undertaken, shall not normally exceed 75% of the net assets of the scheme. 0% to 40% of investment will be in government securities with low risk profile. In addition to the instruments stated above, the scheme may enter into repos /reverse repos as may be permitted by RBI. From time to time, the Scheme may hold cash. A part of the net assets may be invested in the collateralised borrowing & lending obligations (CBLO) or repo or in an alternative investment as may be provided by RBI to meet the liquidity requirements.

Load structure:
The entry load for the scheme is not applicable. In respect of each purchase/switch-in of units, an exit load of 1% is payable if units are redeemed/switched-out within 1 year from the date of allotment. No exit load is payable if units are redeemed/ switched-out after 1 year from the date of allotment.

Minimum application amount:
The minimum amount is Rs. 5,000 per application and any amount thereafter. In case of investors opting to switch into the scheme from the existing schemes of HDFC Mutual Fund (subject to completion of lock-in period, if any) during the NFO Period, the minimum amount is Rs. 5,000 per application and any amount thereafter.

The minimum subscription (target) amount of Rs. 10 million is expected to be raised during the NFO period of HDFC Short Term Opportunities Fund.

Benchmark index:
The scheme`s performance will be benchmarked against CRISIL Short Term Bond Fund Index.

Fund managers:
The fund managers of the scheme will be Anil Bamboli and Anand Laddha.

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