Indiabulls Mutual Fund has announced a new fund offer (NFO) for the Indiabulls Equity Hybrid Fund, an open-ended aggressive hybrid fund. An aggressive hybrid fund is one which predominantly invests its assets in equity and equity-linked securities. The debt portion of the fund provides stability in times of market volatility. The NFO will launch on November 22 and will close on December 6, 2018. The scheme will reopen within five business days of allotment of units.
The scheme will invest 65 to 80 percent of its assets in equity and equity-related assets. This means that it will be classed as equity for tax purposes and hence enjoy favourable tax treatment. You can read more about mutual fund taxation here. Investments in debt and money market instruments will be capped at 30 percent. The scheme may also invest 50 percent of its net assets in derivatives.
SBI, HDFC, L&T are among peers that have aggressive hybrid schemes. SBI Equity Hybrid Fund has five year returns of 17.28 percent and HDFC Hybrid Equity Fund has five year returns of 18.45 percent. (As of Nov. 16, 2018)
CRISIL Hybrid 35+65 – Aggressive Index will be utilized as the benchmark for Indiabulls Hybrid Equity Fund.
| Index Name | 1-yr Returns (%) | 3-yr Returns (%) | 5-yr Returns (%) |
| CRISIL Hybrid 35+65 – Aggressive Index | 0.22 | 9.54 | 12.17 |
*Returns data as of October, 2018
The fund will be managed by Sumit Bhatnagar (for equity), Veekesh Gandhi and Malay Shah (for debt). Bhatnagar also manages Indiabulls Blue Chip Fund, which was launched in February 2012. The five year returns for the fund are 14.83 percent. Shah manages schemes like Indiabulls Ultra Short Term Fund and Indiabulls Liquid Fund. These have five-year returns at 8.75 percent and 8.04 percent, respectively. (As on Nov. 16, 2018)
Key information about the Indiabulls Hybrid Equity Fund:
| NFO period | November 22 – December 6, 2018 |
| Minimum application amount | Rs. 500 |
| Exit load | 1 percent exit load for units in excess of 10 percent redeemed before 12 months from allotment date |
| Benchmark | CRISIL Hybrid 35+65 – Aggressive Index |
| Fund managers | Malay Shah, Sumit Bhatnagar, Veekesh Gandhi |