Edelweiss Mutual Fund launches two target maturity index funds
Edelweiss Asset Management has launched two new target maturity index funds - Edelweiss CRISIL IBX 50:50 Gilt Plus SDL June 2027 & Edelweiss CRISIL IBX 50:50 Gilt Plus SDL April 2037 Index Fund. This fund will invest in a mix of Indian Government Bonds (IGBs) and State Development Loans (SDLs).The Edelweiss CRISIL IBX 50:50 Gilt Plus SDL April 2037 Index Fund will be open for subscription between September 27 to October 6. Edelweiss CRISIL IBX 50:50 Gilt Plus SDL June 2027 Index Fund will be open for subscription between October 6 to October 11. Both the schemes are open-ended target maturity Index Funds investing in the constituents of CRISIL IBX 50:50 Gilt Plus SDL Index – April 2037 & June 2027, respectively.
“After the successful launches of target maturity funds over the last 2 years, we are pleased to announce the launch of 2 more target maturity index funds- Edelweiss CRISIL IBX 50:50 Gilt Plus SDL June–2027 & April-2037 Index Fund. Our new fund with April-2037 maturity will be India’s first Target Maturity Fund with 15 year-long maturity. Our endeavor has been to get long-term money through these target maturity funds and we are now the largest player managing long-term fixed income money of investors. We strive to deliver more in the future and continue our leadership position.” said Radhika Gupta, MD & CEO, Edelweiss Asset Management Limited.
The press release said that the overall passive debt category has crossed the 1 lakh crore mark -- at the industry level – this growth was kickstarted by the launch of the first tranche of the Bharat Bond ETF in December 2019.
According to the fund house, both the NFOs will come with an investment amount that is as low as Rs.5000/-, the fund will have a defined maturity date of Edelweiss CRISIL IBX 50:50 Gilt Plus SDL June 2027 Index Fund – June 30, 2027 & Edelweiss CRISIL IBX 50:50 Gilt Plus SDL April 2037 Index Fund - April 29, 2037. The scheme will follow a Buy & Hold investment strategy in which existing bonds will be held until maturity unless sold for meeting redemptions, dividend payment rebalancing requirements or optimizing the portfolio construction process. The portfolio of eligible securities invested by the Scheme will have, in aggregate, similar quantitative characteristics like that of the underlying index.
Target maturity ETFs and index funds are open-ended debt funds with a specified maturity date that aligns with the expiry date of the bonds they have in their portfolios. These funds are simple and transparent investment vehicles that allow investors to have liquidity, stability, and predictability of returns along with lower tax compared to traditional instruments like fixed deposits. The funds invest only in constituents that are eligible as per the index methodology and investment objective of the schemes.
This story originally appeared on: Muscle & Fitness - Author:Tax Cognition
