He New Fund Offering (NFO) The Franklin India Ultra Short Duration Fund (FIUSDF) opened for subscription on Monday, August 19 and will remain available till August 28, 2024.
Fund Overview
FIUSDF aims to provide a combination of regular income and high liquidity by investing primarily in short-term debt and money market instruments.
The fund’s portfolio will include non-convertible debentures, bonds, certificates of deposit, commercial paper, Treasury bills and government securities.
The duration of the Macaulay portfolio will range from 3 months to 6 months.
Key details of the fund include:
Type of fund: Open
Plan Category: Debt Plan – Ultra Short Duration Fund
Minimum Subscription Amount: ₹5,000
Unit Price During NFO: ₹10 per unit
Output load: zero
Benchmark: Nifty AI Ultra Short Duration Debt Index
The plan will reopen for continuous sale and repurchase on August 30, 2024.
Management and strategy
The FIUSDF will be managed by Rahul Goswami, Chief Investment Officer and Managing Director, Fixed Income India at Franklin Templetonalong with portfolio manager Pallab Roy.
The fund is designed to cater to investors seeking short-term liquidity management or emergency funds, offering a conservative approach with a low interest rate and moderate credit risk.
Rahul Goswami said, “Fixed income should be a core part of any investor’s portfolio. Historically, in India, investors have looked to banking products to meet these needs. However, debt funds like FIUSDF aim to offer comparable returns to traditional savings instruments. We believe FIUSDF could be a valuable addition for those managing short-term liquidity or emergency funds.”
Avinash Satwalekar, President, Franklin Templeton India, said the FIUSDF will enhance the firm’s existing range of fixed-income products targeted at institutional and individual investors.
“FIUSDF leverages our extensive experience in managing funds through various market cycles, targeting a moderate credit risk and balanced income strategy,” he said.
Investment Considerations
Investors interested in the FIUSDF can subscribe to the fund from today until August 28, with units priced at ₹10 each.
The minimum amount for new subscriptions is ₹5,000, and the fund will also accept investments through Systematic Investment Plans (SIPs) starting from ₹500.
The launch of FIUSDF marks Franklin Templeton’s significant return to the Indian debt market following its unprecedented decision in April 2020 to close six funds amid a challenging economic environment.
The new fund reflects a strategic shift, focusing on short-term fixed-income solutions in a high-liquidity environment.
For those considering this investment opportunity, the FIUSDF offers a balanced approach to managing short-term liquidity needs with a conservative risk profile, positioning itself as a strong contender for fixed-income investors in the current economic climate.
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