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NEW DELHI: Aditya Birla Sun Life Mutual Fund has launched Aditya Birla Sun Life Fixed Term Plan - Series TO (1214 days), a close-ended fund. The scheme seeks to generate income by investing in a portfolio of fixed income securities maturing on or before the duration of the scheme.
The fund was launched on 10 January and the NFO (new fund offer) will be close for subscription on 17 January.
Note that no redemption/repurchase of units shall be allowed prior to the maturity of the scheme since it is a close-ended fund. Investors wishing to exit may do so through stock exchanges.
The minimum application amount is ₹1,000/- and in multiples of Rs. 10/ thereafter.
The fund invests 70-100% of total assets in debt securities including government securities and state development loans (SDLs). The fund may also invest 0-30% of total assets in money market instruments.
In the event of the any deviations from the asset allocation mentioned above, the fund manager shall rebalance the portfolio within 30 days from the date of said deviation.
The fund will be managed by Mohit Sharma. He has around 15 years of experience of which 10 years are in financial markets. He joined Aditya Birla Sun Life AMC in October 2015.
The performance of the scheme will be benchmarked to the performance of CRISIL Medium Term Debt Index. CRISIL Medium Term Debt Index is a suitable representation to track the performance of a medium-term debt portfolio comprising of government securities and AAA/AA+/AA rated corporate bonds.
The intended portfolio suggests that 95-100% of the fund will be invested in government securities.
In terms of taxation, the gain on maturity of the scheme will be considered capital gains. The long-term gains will be taxed at 20% with indexation benefit.
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