As the markets hit fresh highs, MFs rush to launch new fund offers

Suresh P Iyengar Mumbai | Updated on December 20, 2019

 Notwithstanding the uncertain economic growth prospects, mutual fund houses in the last 45 days have filed draft documents for launching 22 new schemes, largely in the large- and mid-cap space to tap the buoyant mood in the market.

The latest entrant in the MF space, ITI Mutual Fund has filed application for launching three new schemes, one each in large- and small-cap category, and another in banking and PSU bank debt fund.

JM Financial Mutual Fund has filed for Nifty Bank Index Fund, Credit Risk Fund, Nifty Midcap 100 index and Nifty Smallcap 100 index fund.

Axis Mutual Fund plans to launch Axis Greater China Equity Fund that will provide long-term capital appreciation by investing in units of Schroder International Selection Fund Greater China, a fund that aims to provide capital growth by investing in equity and equity-related securities of People's Republic of China, Hong Kong and Taiwan companies.

The scheme may also invest a part of its corpus in debt, money market instruments and units of liquid schemes in order to meet liquidity requirements, said Axis Mutual Fund.

Nippon India MF has filed for a Nippon India Freedom FOF (fund-of-fund) which will invest in units of equity- and debt-oriented schemes of its own five different funds according to the asset allocation of the scheme. It has also filed papers for launching a multi asset fund.

Nippon India’s multi asset fund will invest in equity and equity-related securities, debt and money market instruments and exchange traded commodity derivatives and gold and gold ETF.

Categorisation effect

Jimmy Patel, MD & CEO, Quantum Mutual Fund, said the increase in documents being filed with SEBI for new fund offers are largely due to small fund houses launching schemes that are not available with them to complete their bouquet of offering after the recent categorisation of schemes.

As the markets are hitting a new high with every passing day, he said a few large mutual funds are getting innovative and coming out with theme-based offers to enhance their asset under management.

With SEBI capping commissions being paid to distributors based on the fund size, some of the fund houses are launching new schemes to make the distributor community happy and keep their cash register ringing, said Patel.

Published on December 20, 2019

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