UTI Mutual Fund to Launch New Close Ended Equity Scheme

UTI Mutual Fund AMC, pioneer of the mutual fund industry in India, has voiced intentions of launching a new close-ended equity scheme – the UTI Equity Savings Fund. Currently, the AMC is in the process of seeking approval from the Securities and Exchange Board of India (SEBI) prior to the scheme’s official launch. The first series of the new fund would be named as UTI Equity Savings Fund – Series 1 and UTI MF AMC expects to release up to 5 additional series of the same scheme at later dates.

The fund house has announced that each series of the UTI Equity Savings Fund would have a tenure ranging from 450 days to 2200 days however the exact tenure will only be known at the time of the actual launch. Being an equity scheme, the UTI Equity Savings Fund is expected to hold 65% to 90% of its assets in equities and equity derivatives. An additional 40% to 85% of the portfolio of the proposed scheme would comprise cash future, while the residual 5% to 25% would be invested in net long equity exposure instruments. There is also a provision for the fund to invest up to 35% of its portfolio in debt instruments if prevailing market conditions justify the action.

The scheme would be available through both regular and direct plans and the minimum investment amount for entry into the scheme would be Rs. 5000 with zero entry and exit loads. The benchmark index for this fund would include – 30% Nifty 50 along with 30% CRISIL Short Term Bond Fund Index and 40% CRISIL Liquid Fund Index.

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