The New Fund Offer (NFO) will open on August 17 and close on August 31, 2026. The scheme will be benchmarked against a combination of 60% CRISIL Short Term Bond Index and 40% Nifty 50 Arbitrage Index.
The fund will invest 95-100% of its assets in units of domestic arbitrage schemes and active and passive debt-oriented mutual fund schemes. The remaining 0-5% can be invested in debt and money market instruments.
According to the scheme details, the exposure to debt-oriented mutual fund schemes and debt and money market instruments will remain below 65% at all times. This structure is aimed at combining the income-oriented characteristics of debt investments with the arbitrage strategy within a single fund of fund.
How the fund will work
Rather than investing directly across individual debt and arbitrage schemes, investors will get exposure to these strategies through one fund. The fund managers will decide the allocation and select the underlying schemes across active debt, passive debt and arbitrage strategies.
The fund will be managed by Sushil Hari Prasad Budhia and Vikash Agarwal.
The scheme is positioned for investors with an investment horizon of at least two years who are looking for relatively better risk-adjusted returns and want the fund manager to handle the selection and allocation across the underlying schemes.
The fund house also highlights the potential tax treatment for investors holding the investment for more than 24 months. As stated in the scheme material, a fund of fund that invests less than 65% in units of debt mutual fund schemes and debt and money market instruments may qualify for long-term capital gains taxation at 12.5% after a holding period of more than 24 months, subject to applicable tax laws.
The minimum investment during the NFO is ₹500, with subsequent investments allowed from ₹100. The scheme will be available under Direct and Regular Plans, with Growth and IDCW options. There is no exit load.
The scheme’s stated objective is to provide investors with a diversified allocation across debt-oriented and arbitrage strategies through a single investment, while the actual returns will depend on the performance of the underlying schemes and market conditions.
