Tata Mutual Fund has launched a New Fund Offer (NFO) for Tata Ultra Short Term Fund which will aim to generate returns through investment in debt and money market instruments such that the Macaulay duration of the portfolio is between 3-6 months. The NFO period will begin on January 11, 2019 and will end on January 21, 2019. Ultra short term funds generally offer returns higher than bank fixed deposits and involve a relatively low amount of interest rate risk.
The open-ended debt scheme will invest up to 100% of its assets in debt and money and market instruments carrying a low to medium amount of risk. The Tata Ultra Short Term Fund will not invest in foreign securitized debt and credit default swaps . The scheme may engage in short selling of securities, however, it will not participate in repo/reverse repo in corporate debt securities.
The scheme will be benchmarked against CRISIL Ultra Short Term Debt Index. The index serves as a benchmark for funds with a residual maturity of 9 months to 1 year, which is shorter than that of short-term debt funds but greater than that of liquid funds.
| Index Name | 1 Year Return | 3 Year Return | 5 Year Return |
| CRISIL Ultra Short Term Debt Index | 7.92% | 7.57% | 8.14% |
*Returns data as of December 2018.
The scheme will be managed by Mr. Akhil Mittal. The other scheme which are being currently managed by Mr. Mittal includes Tata Dynamic Bond Fund and Tata Income Fund among others. The two schemes have generated a 5 year return of 9.32% and 8.42% respectively.
Key information about the Tata Ultra Short Term Fund NFO:
| NFO Period | January 11, 2019 – January 21, 2019. |
| Minimum Application Amount | Rs. 5,000 |
| Exit Load | Nil |
| Benchmark | CRISIL Ultra Short Term Debt Index |
| Fund Manager | Akhil Mittal |
Other Funds by Tata Asset Management
| Scheme Name | 3Y Returns (%) | AUM (Rs. Cr.) | Category |
| Tata Digital India Fund | 21.92 | 111.56 | Sectoral/Thematic Fund |
| Tata Banking and Financial Services Fund | 18.01 | 253.91 | Sectoral/Thematic Fund |
| Tata India Consumer Fund | 17.4 | 973.5 | Sectoral/Thematic Fund |
| Tata Retirement Savings Fund Progressive Plan | 14.17 | 451.51 | Multi Cap Fund |
| Tata Index Sensex Direct | 14.14 | 5.04 | Large Cap Fund |
| Tata India Tax Savings Fund | 13.2 | 1398.27 | ELSS |
| Tata Index Nifty Direct | 12.23 | 11.08 | Large Cap Fund |
| Tata Retirement Savings Fund Moderate Plan | 12.09 | 659.89 | Aggressive Hybrid Fund |
| Tata Large & Mid Cap Fund | 11.46 | 1297.88 | Large & Mid Cap Fund |
| Tata Midcap Growth Direct Plan | 11.31 | 692.48 | Mid Cap Fund |
| Tata Large Cap Direct Plan | 10.75 | 799.42 | Large Cap Fund |
| Tata Ethical Direct Plan | 10.32 | 517.86 | Sectoral/Thematic Fund |
| Tata Equity PE Fund | 8.78 | 3519.81 | Value Fund |
| Tata Retirement Savings Fund Conservative Plan | 8.76 | 133.5 | Conservative Hybrid Fund |
| Tata Gilt Securities Fund | 8.01 | 117.76 | Gilt Fund |
| Tata Income Fund | 7.49 | 112.41 | Medium to Long Duration Fund |
| Tata Dynamic Bond Fund | 7.09 | 701.43 | Dynamic Bond Fund |
| Tata Hybrid Equity Fund | 6.91 | 5552.16 | Aggressive Hybrid Fund |
| Tata Liquid Fund | 6.9 | 15156.38 | Liquid Fund |
| Tata Equity Savings Fund | 6.24 | 214.93 | Equity Hybrid Saving Fund |
{Data as on Feb 20, 2020; Source: Value Research}