The Baroda BNP Paribas' new fund offer (NFO) of its multi-asset mutual fund will run from November 28 to December 12, 2022. The fund aims to invest in a mix of equity, fixed-income instruments, and gold exchange-traded funds (ETF s).
The fund house said the equities would aim to generate high returns, debt assets would ensure fixed returns during market volatility, and gold ETFs would act as a hedge against a recession.
The minimum subscription amount of the fund is Rs 5,000, and a lump sum investment plan is available post the minimum investment.
In a press release detailing the fund, Suresh Soni, CEO of Baroda BNP Paribas AMC, said the fund is "well-diversified" across asset classes and a "good investment option, as it saves the hassle of investing, tracking and maintaining investments in multiple strategies."
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The fund managers are Jitendra Sriram, who earlier worked with HSBC AMC, Deutsche Equities, and Capital Markets, and Vikram Pamnani, who was with Deutsche Bank and Canara Robeco.
The fund will be benchmarked against a customized index, comprising 65 per cent of the Nifty 500 TRI plus 20 per cent of the Nifty Composite Debt Index and 15 per cent of INR Price of Gold.
The fund's investment objective is to pursue long-term capital growth by allocating 65-80 per cent of its assets to stocks, 10-25 per cent to debt instruments and gold ETFs, and up to 10 per cent into units of Real Estate Investments Trusts (REITs) and Infrastructure Investment Trusts (INVITs). The fund seeks to use the power of equity, fixed income, and gold ETFs to drive growth and, at the same time, provide a cushion against the downside.
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The fund intends to use a multi-cap investment technique backed by solid research, owning 45-55 stocks with a diverse allocation across sectors. It will invest in a high-quality portfolio of debt and money market instruments to earn while assuming relatively low credit risks. In addition, the fund will seek exposure to gold through gold ETFs.
This fund can be the one-stop shop for retail investors looking to create a portfolio with a diversified asset allocation and at a low cost -- since separately investing in these assets could cost you a fortune. Additionally, the asset classes will have a low correlation, allowing the fund to perform across market cycles.
