Invesco Mutual Fund announced the launch of Invesco India Nifty G-sec Jul 2027 Index Fund, an open-ended index fund scheme tracking the Nifty G-sec Jul 2027 Index constituents.
The scheme opened for public subscription on March 16, 2023, and will close on March 17, 2023. The scheme re-opens for continuous sale and repurchase within five business days from the date of allotment.
Q. What kind of mutual fund schemes is this?
This open-ended Target Maturity Index Fund scheme tracks the Nifty G-sec Jul 2027 Index. The fund is best for investors seeking income for the target maturity period.
This fund involves a relatively high interest rate risk and relatively low credit risk. However, there is no assurance that the scheme’s investment objective will be realized.
Q. What is the main objective of investing in this fund?
The investment objective of the scheme is to generate returns which correspond (before fees and expenses) with the performance of the Nifty G-sec Jul 2027 Index, subject to tracking differences.
However, there is no assurance that the objective of the scheme will be realised and the scheme does not assure or guarantee any returns.
Q. How may one invest in this fund?
Investors can invest under the scheme with a minimum investment of ₹1000 per plan/option and in multiples of any amount thereafter. There is no upper limit for investment.
The scheme offers two plans as follows:
- Regular Plan
- Direct Plan
Each of the above plans under the scheme offers the following options:
- Growth option
- Payout of Income Distribution cum Capital Withdrawal (IDCW) option
Under normal circumstances, the asset allocation of the scheme will be as follows:
|Instruments||Indicative Allocations (% of net assets)||Risk Profile|
|Government securities, TREPS on Government securities/Treasury Bills||95||100||Low to medium|
|Money Market Instruments||0||5||Low to medium|
Q. Are there similar mutual funds in the market?
To date, many asset management companies (AMCs) have launched such index funds, thus, allowing inclined investors to avail of returns corresponding to the total returns of the securities in this particular index. These include:
|Name of the fund||Three-year returns (in %)||Five-year returns (in %)|
|DSP Government Securities Fund||5.98||8.73|
|Edelweiss Government Securities Fund||6.90||8.14|
|Aditya Birla Sun Life Government Securities Fund||5.89||8.09|
|Bandhan Government Securities Fund||5.73||8.60|
|LIC MF Government Securities Fund||4.91||7.80|
|Franklin India Government Securities Fund||4.18||6.42|
Q. How will the scheme benchmark its performance?
The performance of the Invesco India Nifty G-sec Jul 2027 Index Fund is benchmarked against the Nifty G-sec Jul 2027 Index.
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.
For each purchase of units through Lumpsum/switch-in/Systematic Investment Plan (SIP)/Systematic Transfer Plan (STP)/IDCW Transfer Plan, the exit load will be as follows:
- If units are redeemed/switched out within 30 days from the date of allotment - 0.25%
- If units are redeemed/switched out after 30 days from the date of allotment, no exit load is payable
- Switch between the plans under the scheme: Nil
Q. Who will manage this scheme?
Krishna Cheemalapati and Vikas Garg will be the fund managers for the scheme.
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. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.