Franklin Templeton Investments (India) announced the launch of its new fund offer (NFO), the Templeton India Income Opportunities Fund (TIIOF). It is an open-end fund.
TIIOF seeks to provide regular income and capital appreciation by investing in fixed income securities. It is looking to take concentrated exposure to a particular category of income securities based on the opportunities available.
With the global interest rates going down and similar traits being seen in India as well, the fund intends to focus on securitized and high yielding corporate debt to take advantage of the yield premiums and will have the ability to take concentrated exposure to a particular category of income securities based on the opportunities available.
The fund house believes that a strengthening economy will lead to a contraction in spreads benefiting such securities. In this situation, a portfolio focused on good quality securitized debt and NBFCs has the potential to deliver superior returns. Also, its focus on accruals is likely to help in mitigating the impact of any hardening of rates.
Its asset allocation will encompass Government Securities and/or securities that are unconditionally guaranteed by the Central/State Government for repayment of principal and interest: up to 100 per cent; debt securities issued by public sector undertakings (PSUs): up to 100 per cent; debt securities issued by private sector corporates including banks and financial institutions: up to 100 per cent; securitised debt: up to 100 per cent. Money Market Instruments: up to 100 per cent (including investments in Foreign Securities as may be permitted by SEBI/RBI up to 50% of the net assets of the scheme, exposure in derivatives up to a maximum of 50%).
The fund has been benchmarked against Crisil Short Term Bond Fund Index.
The fund would be managed by Vivek Ahuja and Sachin Padwal Desai.
The fund house has over Rs 29,925 crore of average assets under management (AAUM) and 25 lakh investor accounts, as on October 30, 2009.
NFO Opens: December 1, 2009
NFO Closes: December 10, 2009
Units: Rs 10 each
Minimum Investment: Rs 5000 and in multiples of Re 1 thereafter.
Options: Growth & Dividend
Exit Load: 3 per cent if redeemed within 6 months. Two per cent if redeemed after 6 months, but within12 months and one per cent if redeemed after 12 months, but within 18 months
Benchmark: Crisil Short Term Bond Fund Index