Publish Date:
Nippon India Mutual Fund has launched Nippon India Fixed Horizon Fund - XLIII - Series 5.
It is a close-ended income scheme that carries relatively high interest rate risk and Moderate Credit Risk.
The investment objective of the scheme is to seek to generate returns and growth of capital by investing in a diversified portfolio of the following securities maturing on or before the date of maturity of the scheme with the objective of limiting interest rate volatility –
• Central and State Government securities and
• Other fixed income/ debt securities
However, there can be no assurance or guarantee that the investment objective of the scheme will be achieved.
It is a Fixed Maturity Plan that will mature in 2,315 days from the date of allotment.
For the purpose of achieving the investment objective, the scheme will invest in a portfolio of Debt and Money Market securities, maturing on or before the maturity of the scheme.
Under normal circumstances, the scheme will invest 90% to 100% of its assets in Government securities / State Development Loans (SDLs) & Debt Instruments; whereas up to 10% of its assets can be invested in Money Market instruments.
As mentioned in the Scheme Information Document (SID), the fund management team will endeavor to maintain consistent performance in the scheme by maintaining a balance between safety, liquidity, and profitability aspects of various investments.
The fund manager will try to achieve an optimal risk-return balance for the management of the fixed income portfolios.
The investments in debt instruments carry various risks like interest rate risk, liquidity risk, default risk, purchasing power risk, etc. While they cannot be done away with, they can be minimized by diversification and the effective use of hedging techniques.
The fund management team will take an active view of the interest rate movement by keeping a close watch on various parameters of the Indian economy, as well as developments in global markets.
Investment views/decisions will be taken on the basis of the following parameters:
1. Prevailing interest rate scenario
2. Quality of the security/instrument (including the financial health of the issuer)
3. Maturity profile of the instrument
4. Liquidity of the security
5. Growth prospects of the company/industry
6. Any other factors in the opinion of the fund management team.
The Fund Management proposes to use analytic risk management tools like VAR/convexity/ modified duration for effective portfolio management.
The NFO opens for subscription on February 25, 2022, and closes on February 28, 2022.
Nippon India Fixed Horizon Fund - XLIII - Series 5’s performance will be benchmarked against Crisil Medium to Long Term Debt index.
The fund will be managed by Mr. Amit Tripathi.
The New Fund Offer price is Rs 10 per unit and the minimum application amount for initial purchase is Rs 5,000 and in multiples of Re 1 thereafter during the NFO period.
The scheme offers Regular Plan and Direct Plan having a Growth Option and Income Distribution cum capital withdrawal Plan – Payout Option.
The units of the scheme shall be listed on BSE Ltd. However, the trustees reserve the right to list the units on any other Stock Exchange. The Regulations require that every close-end scheme (except Equity Linked Saving Scheme) be mandatorily listed on a recognised stock exchange.
Investors will not be able to redeem their units during the tenure of the Scheme and there will be redemption by the fund on the maturity of the Scheme. However, the units held in dematerialized form can be traded on the Stock Exchange.
The AMC reserves the right to list the units of the Scheme on any other recognized stock exchange at later date, after obtaining the required approval from the respective stock exchange.