Trust Asset Management has introduced a new fund offer (NFO) called TrustMF Money Market Fund. The issue will open for subscription on 5 August and close on 11 August.
The new fund offer will be managed by Anand Nevatia, fund manager, Trust Mutual Fund and this is the fifth addition to Trust Mutual Fund’s fixed income product portfolio.
Before we proceed, let us first deconstruct the concept of a new fund offer.
New Fund Offer
A New Fund Offer (NFO) is the process through which an asset management company (AMC) creates a new fund on a first-subscription basis to facilitate the purchase of securities.
The fund house collects funds from the general public through an NFO in order to buy securities such as equity shares, bonds, and other financial instruments on the market. As a newcomer to the market, NFO is less expensive than the current funds.
Fund Overview
TrustMF Money Market Fund is an open-ended debt scheme investing in money market securities. A relatively low-interest rate risk and moderate credit risk.
The fund aims to seek benefit from steepness in the money market yield curve and provides an avenue for parking short-term surplus with relatively low-interest rate risk.
Fund Objective
The objective of the scheme is to generate capital appreciation by investing in money market instruments having maturity of up to 1 year. However, there can be no assurance that the investment objective of the scheme will be realized, as per the press release.
Top five money market funds that demonstrated the best performance in the past three years
| Name of schemes | 3 year trailing returns (%) |
| HDFC Money Market Fund | 5.13 |
| Tata Money Market Fund-Reg | 5.1 |
| Nippon India Money Market Fund | 5.03 |
| ICICI Pru Money Market Fund | 4.99 |
| UTI Money Market Fund-Reg | 4.98 |
As one can see in the table, HDFC Money Market Fund gave a little over 5.13 percent return in the past three years, Tata Money Market Fund gave 5.1 percent return and Nippon India Money Market Fund gave 5.03 percent return.
Sandeep Bagla, CEO, TRUST Mutual Fund said, “We are happy to announce the launch of TRUSTMF Money Market Fund. We continue to focus on our key ethos of providing credible investment solutions to our investors. The aim of the fund is to take advantage of the Money Market yield curve which has seen perennial steepness. In these uncertain times, Money Market Mutual Funds will provide relative stability and reasonable returns to investors looking to park their surplus money for a 3 to 6 months investment horizon.”
