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Mirae Asset Investment Managers India has launched Corporate Bond Fund that will invest in AA+ and above rated corporate bonds, Government Securities and T-Bills.
The NFO will close on March 9. The fund will be benchmarked with the Nifty Corporate Bond Index. The fund will investment across the yield curve but target Modified Duration will be within range of 2-5 years based on interest rate outlook.
The fund will follow an active portfolio management based on flexible interest rate strategy and will not invest in perpetual bonds. The fund has the potential for better risk adjusted returns compared to other debt fund categories and traditional fixed income instruments. Also, debt funds benefit from taxation benefits if the holding period is more than three years, said the fund house.
Swarup Mohanty, CEO, Mirae Asset Investment Managers (India), said with a strong credit process the fund house was not exposed to most stressed asset cases and this fund is suitable for investors looking for an investment horizon of over three years.
Mahendra Jajoo, CIO, Mirae Asset Investment Managers, said the benefit of improving rating prospects for high quality corporates in a reviving economy and likely widening of spreads with higher credit pick up in coming months may provide investors a good entry point to invest in Corporate Bond Funds with a three-year time horizon.
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