Essel Mutual Fund has filed draft papers with SEBI (Securities Exchange Board of India) for the Essel Balanced Advantage Fund. This new open-ended hybrid scheme from Essel MF will operate on the principle of dynamic asset allocation by altering its equity and debt investment allocations according to changing market conditions. You can invest in/redeem scheme units on all days when markets are open due to the open-ended nature of the scheme.
Essel Balanced Advantage Fund is a hybrid scheme, hence it will invest in both equity/equity derivatives as well as debt/money market instruments. For tax purposes the minimum equity/equity derivative allocation of this scheme will be maintained at 65%, while debt and money market instruments will account for up to 35% of the scheme’s available assets. Additionally, investments by the scheme into units of REITs (Real Estate Investment Trusts) and InvITs (Infrastructure Investment Trusts) will be capped at 10% of scheme assets. This scheme also retains the flexibility to invest in credit default swap instruments, corporate debt securities or engage in short selling transactions.
Nifty 50 Hybrid Composite Debt 50:50 Index has been chosen as benchmark for the Essel Balanced Advantage Fund. This composite index consists of 50% Nifty Composite Debt Index and 50% Nifty 50 TRI (Total Returns Index). As of 30th April 2018, the 1 year and 3 year returns of the benchmark were recorded at 10.45% and 9.5% respectively. The use of a composite index is in line with this hybrid scheme’s mandate to invest in both equity/equity derivatives as well as various debt/money market instruments.
Essel Balanced Advantage Fund will be co-managed by Viral Berawala and Killol P. Pandya. They currently manage other Essel Mutual Fund schemes including Essel Large Cap Equity Fund, Essel 3 in 1 Fund, Essel Equity Hybrid Fund, Essel Liquid Fund and Essel Ultra Short Term Fund. Among these, Essel Large Cap Equity Fund is one of the top performers in its category with 3 year and 5 year returns recorded of 7.54% and 12.57% (as of 24th October 2018).