Baroda BNP Paribas Mutual Fund announced the launch of the Baroda BNP Paribas Floater Fund, an open-ended debt scheme predominantly investing in floating rate instruments.
The scheme opened for public subscription on April 10, 2023, and will close on April 24, 2023.
Q. What kind of mutual fund scheme is this?
This is an open-ended debt scheme predominantly investing in floating rate instruments. This scheme is suitable for investors seeking
- Regular income over the short-term investment horizon
- Inclined to invest predominantly in floating rate instruments (including fixed rate instruments converted to floating rate exposures using swaps/derivatives).
Q. What is the main objective of investing in this fund?
The primary objective of the scheme is to generate regular income through investment in a portfolio comprising predominantly of floating rate instruments and fixed rate instruments swapped for floating rate returns. The Scheme may also invest a portion of its net assets in fixed-rate debt and money market instruments. However, there can be no assurance or guarantee that the financial objective of the scheme will be achieved.
Q. How may one invest in this scheme?
Investors can invest under the scheme with a minimum investment of ₹5000 per plan/option and in multiples of Re 1. There is no upper limit for investment.
Under normal circumstances, the asset allocation of the scheme will be as follows:
|Instruments||Indicative Allocation (% of total assets)||Risk Profile|
|Floating Rate Debt Instruments (including Fixed Rate Debt Instruments swapped for floating rate returns)||65||100||High|
|Debt & Money Market instruments||0||35||Low to Medium|
|Units issued by REITs & INvITs||0||10||Very High|
Q. How will the scheme benchmark its performance?
The performance of the scheme will be benchmarked to the performance of the CRISIL Low Duration Debt Index. These uniform benchmarking of schemes indices are termed as a first-tier benchmark which reflects the category of the scheme.
Q. Are there any entry or exit loads to this scheme?
This scheme involves no “Entry Load”, which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load” is also “Nil”.
Q. Who will manage this scheme?
The investments under the scheme will be managed by Mayank Prakash and Prashant Pimple.
Q. Does the fund contain any inherent risk?
The scheme involves “Moderate Risk” as per the details mentioned in the Scheme Information Document and is best suited to investors willing to understand that their principal will be subject to moderate risk only. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.