Mirae Asset has launched Mirae Asset Banking & PSU Debt Fund. It is an open ended debt scheme predominantly investing in debt instruments of banks, public sector undertakings, public financial institutions and municipal bonds.
The New Fund Offer (NFO)of Mirae Asset Banking & PSU Fund is open and will close on July 20. The scheme will reopen for continuous sale and repurchase from July 27.
According to Sebi, a banking & PSU fund is an open ended debt scheme which has to invest at least 80% of its assets in debt instruments of banks, public sector undertakings and public financial institutions.
Mirae Asset Banking & PSU Debt Fund will follow an active style of management based on credit spread and interest rate outlook. The scheme seeks to have higher Allocation in AAA rated instruments.
The scheme proposes to generally maintain a portfolio duration of 2 to 5 years with use of G-sec to shift duration.
Mirae Asset Banking & PSU Fund will be benchmarked against NIFTY Banking and PSU Debt Index. The scheme will be managed by Mahendra Jajoo.
The fund will offer both regular and direct plans with growth and dividend options. It allows lumpsum and investment through SIP.
The scheme will allow investors to invest a minimum of ₹5,000 and in multiples of Re 1 thereafter.
This fund will follow the taxation of a debt mutual fund. Short term gains on investments held for less than three years will be added to income and taxed as per applicable tax slab.
Long term gains on investments held for more than three years will be taxed at 20% after indexation.
Indexation is a technique where the purchase price of the investment is adjusted higher to factor in inflation. This reduces the taxable gains for the investors and help them save taxes.