Deutsche Asset Management India launched an arbitrage fund today, in the open-ended equity scheme portfolio.
“The DWS Arbitrage Fund is an ideal investment solution for investors, seeking returns through arbitrage opportunities that exist in the equity and derivatives markets,” Deutsche AMC India head Suresh Soni said.
The new fund opens from August 13 would invest in arbitrage opportunities that may exist in the equity and derivatives markets.
The fund expects to predominantly invest in the cash futures arbitrage strategy, that is, buying a stock in the cash market and selling it in the futures market, resulting in a hedge, where the fund portfolio is locked in a spread and is not affected by price movements in the spot market and futures markets, a company release said.
Being an equity-oriented fund, it has a lower tax incidence for investors, compared to debt and liquid funds, with respect to dividend distribution and capital gains tax, the release said.
The portfolio seeks to generate returns by investing in arbitrage opportunities available in equity markets. It claims to have potential to earn higher post tax returns vis-a-vis debt and money market funds.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.