NFO Update: Samco Mutual Fund launches arbitrage fund

Samco Mutual Fund has announced to launch Samco Arbitrage Fund, an open-ended scheme investing in arbitrage opportunities.

The new fund offer or NFO of the scheme will open for subscription on November 11 and will close on November 20. The scheme will reopen for continuous sale and repurchase not later than December 3.

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The objective is to generate capital appreciation and income by predominantly investing in arbitrage opportunities in the cash and the derivative segments of the equity markets and the arbitrage opportunities available within the derivative segment and by investing the balance in debt and money market instruments.

The scheme will be benchmarked against NIFTY 50 Arbitrage TRI and will be managed by Paras Matalia, Dhawal Ghanshyam Dhanani, and Umeshkumar Mehta.

It will offer regular and direct options both with growth options only. An exit load of 0.25% will be applicable if the investment is redeemed or switched out on or before 30 days from the date of allotment of units. No exit load will be charged, if investment is redeemed or switched out after 30 days from the date of allotment of units.

The minimum application amount for lumpsum investment is Rs 5,000 and in multiples of Re 1 thereafter. For SIP, the minimum application amount is Rs 500 and above with minimum 12 installments. The minimum additional purchase amount is Rs 500 and in multiples of Re 1 thereafter.

Around 65-100% of the assets will be invested in equities and equity-related instruments (hedged exposure), and 0-35% in debt and money market instruments. The maximum total expense ratio (TER) permissible under Regulation 52 (6) (c) is up to 2.25%.

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The scheme will endeavour to invest in arbitrage opportunities between spot and futures prices of exchange-traded equities and the arbitrage opportunities available within the derivative segment as per the investment objective and the asset allocation pattern of the scheme. If suitable arbitrage opportunities are not available in the opinion of the fund manager, the scheme may invest in debt and money market securities.

The scheme will be suitable for investors who are seeking to generate low volatility returns over short- to medium-term and want to predominantly invest in arbitrage opportunities in the cash and derivative segments of the equity markets.