Union KBC Mutual Fund – subsidiary of Union Bank of India launches Union KBC Trigger Fund - Series 1, a close- ended equity scheme with a feature of inbuilt profit booking, to enable the investors to realize their profits at a pre-defined level and enjoy benefits of appreciation of the investments.
The New Fund Offer (NFO) of the Scheme will open on 14 October 2013 and will close on 25 October 2013. The NFO offer price is Rs 10 per unit. The minimum application amount is ` 5,000 and in multiples of Rs 10 thereafter.
The Scheme will invest in a portfolio of equity and equity related securities, predominantly constituted of Companies in S&P BSE 200 Index. The Scheme may invest in Debt and Money market instruments for tactical reasons and/or rebalancing the portfolio.
The Scheme has a unique feature of inbuilt profit booking, to enable the investors to realise their profits at a pre-defined level. In the event that the NAV of the Direct Plan of the Scheme crosses ` 13 per unit (Trigger Level) within a 3 year period from the date of allotment, the Scheme will automatically be liquidated on the 10th business day from the NAV of the Direct Plan crossing ` 13/- and the redemption proceeds at the applicable NAV of the 10th business day will be returned to the investors of both the Plans under the Scheme. If the NAV per unit of the Direct Plan does not touch ` 13 at any time during the 3 year period, the Scheme will mature at the end of 3 years from the date of allotment at the then prevailing NAV.
In other words, the Scheme automatically redeems the investor's investment once the predetermined growth is achieved. In case, the predetermined growth is not achieved during the 3 year period, the scheme would mature at the end of 3 years at the then prevailing NAV.
Speaking about the launch, G Pradeepkumar, CEO, of Union KBC AMC said “This product makes a serious attempt to allow investors to actually enjoy the benefits of market appreciation if a predefined trigger level is achieved. Often people see the NAV of the scheme going up to a good level, only to see it coming down later on. This issue would be addressed to a great extent by compulsorily liquidating the scheme when the NAV touches the pre-defined level.”
The Scheme will be listed on the stock exchange. Investors wishing to exit the Scheme before maturity may do so through the stock exchange.
The investment team will follow an active management strategy and a bottom up approach for stock selection.
The Scheme will be managed by Mr. Ashish Ranawade.
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