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Friday, January 23, 2009

Mirae Asset MF unveils Gilt Fund

NFO period from 22 January–02 February 2009

Mirae Asset Mutual Fund has launched new issue period of Mirae Asset Gilt Fund on 22 January 2009. The new issue will remain open till 02 February 2009. The NFO price for the fund is Rs 10 per unit. It is an open ended gilt scheme. The scheme will re-open for continuous sales and repurchase on or before 9 February 2009.

The Gilt Fund has two plans: Investment Plan and Savings Plan.

Details:

Investment objective of Investment Plan: The investment objective of the scheme is to seek to generate returns commensurate with low credit risk by predominantly investing in the portfolio comprising of sovereign securities issued and guaranteed by Central and State Government with residual maturity ranging from 1 year to 20 years or higher.

The average portfolio maturity duration of the plan will exceed 4 years. The Scheme may also invest in money market instruments which include but is not limited to treasury bills, CBLO, repo/reverse repo and any other like instruments.

Investment objective of Savings Plan: The investment objective of the scheme is to seek to generate returns commensurate with low credit risk by predominantly investing in the portfolio comprising of short to medium term Government securities guaranteed by Central and State Government with an average portfolio maturity duration not exceeding 5 years.

The Scheme may also invest in money market instruments which include but is not limited to treasury bills, CBLO, repo/reverse repo and any other like instruments.

Investment options: The scheme offers four options viz. regular, institutional bonus and provident fund under both investment and saving plans.

Minimum Investemt amount: The minimum investment amount under regular sub-plan is Rs 5,000 and in multiples of Re 1 thereafter, under institutional sub-plan is Rs 10 lakh and in multiples of Re 1 thereafter, under bonus sub-plan is Rs 5000 and in multiples of Re 1 thereafter and under Provident Fund sub-plan is Rs 10000 and in multiples of Re 1 thereafter. Additional investments in an existing folio can be made for Rs 1000 and in multiples of Re 1 thereafter.

The fund house seeks to raise a minimum subscription amount of Rs. 1 crore under each plan during its New Fund Offer period.

Load structure:

The fund will not charge an entry load.

The scheme will charge an exit load of 0.60% for provident fund option under saving plan if redeemed upto 365 days from the date of allotment.

Regular option under investment plan will charge 0.50% exit load for redeemptions made upto 180 days from the date of allotment and 0.80% of exit load for the provident fund option, if redeemed upto 365 days from the date of allotment.

It will not charge any exit load for the remaining plans and sub-plans.

Asset allocation:

Investment Plan: The scheme will invest up to 65-100% in sovereign securities issued and guaranteed by State and Central government with average portfolio maturity duration of the plan exceeding 4 years. The scheme will invest upto 35% in the money market instruments.

Saving Plan: The scheme will invest up to 65-100% in sovereign securities issued and guaranteed by state and central government with average portfolio maturity duration of not exceeding 5 years. The scheme will invest upto 35% in the money market instruments

The Scheme may invest in derivatives up to 50% of the net assets of the Scheme only for the purpose of hedging and portfolio rebalancing.

The Scheme may also engage in stock lending to the extent of 10% of net assets of the Scheme or any other limits as prescribed by the Securities and Exchange Board of India, from time to time.

The benchmark index for investment plan is I Sec Li-Bex - and for savings plan it is I Sec Si-Bex.

Murthy Nagarajan is fund manager for the scheme.

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