• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Our Bureau

Kolkata , Aug. 28

BIRLA Mutual Fund has lined up a fund of funds (FoF) with four investment plans, based on the principle of asset allocation. The four plans have been identified as aggressive, moderate, conservative and dynamic debt.

The FoF, the fourth of its kind mooted so far, is to invest in a combination of growth and income scheme managed by Birla MF, the offer document sent to SEBI for clearance has mentioned.

Birla Asset Allocation Fund, as the scheme has been named, will follow a risk diversification strategy that will enable investors to choose an option in line with their risk profiles. Each plan will carry a distinct mix of equity and debt of its own, with a re-balancing facility. The latter, aimed at maintaining a pre-defined asset allocation, will be implemented on a monthly basis on the last business day of the month.

The funds chosen by Birla MF for the proposed FoF include some of the better-known products managed by it. These include Birla Advantage Fund and Birla IT Fund (to be renamed Birla India Opportunities Fund) on the equity side, and Birla Income Plus and Birla Gilt Plus on the debt side.

It may be mentioned here that Birla Advantage Fund and Birla Income Plus are the flagship equity and debt schemes managed by Birla MF. The latest FoF proposal follows similar plans devised earlier by Franklin Templeton and Prudential ICICI. While no FoF has hit the market so far, fund sources say that other players are working out their own schemes.

The aggressive plan developed by Birla Asset Allocation Fund will invest 75 per cent in equity schemes and the remaining 25 per cent in debt schemes. The fund manager, the offer document has noted, will try to put a higher weightage to aggressive growth and sector-specific schemes. The indicative asset allocation in this case (predominantly equity-centric) will include 25 per cent in favour of Birla Advantage, 20 per cent in Birla Dividend Yield Plus and 15 per cent in Birla Midcap Fund. The rest will be spread over schemes like Birla IT and Birla MNC.

The other plans, each with dividend and growth options, will follow their own investment patterns. The moderate plan, for instance, will be 51 per cent invested in equity and 49 per cent in debt. The conservative plan will have more debt (75 per cent) than equity (25 per cent). And the dynamic debt plan will be 100 per cent invested in debt.

Article E-Mail :: Comment :: Syndication

Stories in this Section
Canbank MF launches new schemes

Copyright © 2003, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line