NFOs: Invesco Global Consumer Trends Fund of Fund, ITI Large Cap, Nippon India Passive Flexicap FoF
Here is the NFO roundup of the week where we talk about the important schemes that are currently open for subscription. Read on.
Invesco India – Invesco Global Consumer Trends Fund of Fund (FoF)
Invesco MF has launched this fund of fund. The scheme aims to provide long-term capital appreciation by investing predominantly in units of Invesco Global Consumer Trends Fund, an overseas fund.
The underlying global fund covers a wide range of investment themes – from e-commerce, entertainment, Internet services, autonomous driving to active lifestyles and invests in companies like Amazon, Netflix, Uber, Electronic Arts, Nintendo etc. that are boosted by the technology-driven changes in consumer lifestyles, and offers targeted exposure to global companies that may benefit from changed consumer trends.
The underlying global fund has a long established performance track record of over 26 years with AuM of over US$ 2.76 bn or Rs 20,416 crore (as at 31st October, 2020).
The Invesco India – Invesco Global Consumer Trends Fund of Fund (FoF) closes for subscription on December 18. If more than 10% of the units are redeemed / switched out within 1 year from the date of allotment, exit load of 1% will be charged.
Thematic FoFs are usually a no-no as core portfolio allocation. However, given the underlying fund’s long track-record, investors may consider investing if they desire returns from global consumer investing, which is a multi-decade opportunity in many markets.
ITI Large Cap Fund
This is a largecap offering from new fund-house, ITI. Despite domestic market valuations near peaks, many sectors and stocks are trading at cyclical bottom. Development of vaccines can improve the economic growth outlook. The largecap fund appears to have a GARP-bias as it reasons 35 out of 50 stocks in Nifty50 Index are still undervalued.
The ITI Large Cap Fund will focus on most of the attractively valued stocks are trading below their historical average. Large caps being cash rich can potentially surprise on growth in a good economic environment. Largecap funds are core to any good investment portfolio.
The fund will invest in largecap stocks that meet SQL investment philosophy, are beneficiaries of formalization of the economy, are trading at cyclical bottom, face maximum macro headwinds and can reverse and can potentially attract global liquidity. Normally, the fund would be invested minimum 90% and no major cash call would be taken. In terms of sector weights, the fund can take freedom of 7% over benchmark. At least 80% of the 40-stock portfolio will be of core stocks and tactical bets will not be more than 20%.
The largecap NFO closes for subscription on December 18. In term of exit load, there will be 1% if redeemed or switched out on or before completion of 12 months from the date of allotment of units.
Nippon India Passive Flexicap FoF
While it’s confusing to decide the right allocation between Large, Mid and Smallcap stocks, it is even tougher to identify the best stocks/funds to invest in, within these categories. To address this problem, Nippon MF has come out with a unique combination of active + passive investing.
Nippon India Passive Flexicap FoF aims to follow the collective wisdom of the market to decide appropriate allocation across market caps. Then, it invests your money in appropriate low cost ETFs/ Index Funds. Do understand that investments in this new fund will be at moderately high risk. While you are always invested in the entire market with this fund, you do not miss out on any opportunity.
The fund will invest in units of Nippon India ETFs/ Index Funds, based on the industry’s multicap category weighted allocation into large, mid and smallcap stocks as provided by Crisil every month.
This product endeavors to eliminate individual fund manager biases towards market cap allocation and sector / stock selection. It also aims to generate returns relative to markets with relatively lower volatility. The new fund offer period closes on December 24. There is no exit load.
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