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Thursday, April 02, 2009

Religare MF files offer document with Sebi

Plans to launch Religare Credit Opportunities Fund

Name of Fund: Religare Credit Opportunities Fund

Scheme: An open-ended income scheme.

Investment Objective: The investment objective of the scheme is to generate high level of current income consistent with preservation of capital and maintenance of liquidity by investing primarily in investment-grade debt securities and money market instruments.

Investment Options: The scheme offers two plans viz. regular and institutional with growth and dividend option. The dividend option will offer daily, weekly dividend with only dividend reinvestment facility and monthly dividend option with payout and reinvestment facility.

Asset Allocation: The fund will invest upto 65%-100% in debt securities and money market instruments with average maturity of less than 1 year. And it will invest upto 35% in debt securities with average maturity more than 1 year.

The scheme will invest only in debt instruments which are issued by a corporate whose debt programme is rated as investment grade by a credit rating agency.

Investment in securitized debt including pass through certificate (PTC) shall not exceed 70% of the net assets of the Scheme. The Scheme will not invest in foreign securitized debt.

The Scheme may use derivatives for purposes as may be permitted from time to time. The maximum derivative position will be restricted to 50% of the net assets of the Scheme.

The Scheme may seek investment opportunity in foreign securities in accordance with the guidelines stipulated by SEBI and RBI from time to time. The exposure to foreign securities (including mutual fund and other approved securities) shall not exceed 50% of the net assets of the Scheme.

In addition, the Scheme may enter into repos/reverse repos as may be permitted by RBI. From time to time, the Scheme may hold cash. A part of the net assets may be invested in the Collateralised Borrowing & Lending Obligations (CBLO) or repo or in an alternative investment as may be provided by RBI to meet the liquidity requirements.

The Scheme may engage in short selling of securities in accordance with the framework relating to short selling and securities lending and borrowing specified by SEBI. The Scheme shall not deploy more than 20% of its net assets in securities lending and not more than 5% of the net assets of the Scheme will be deployed in securities lending to any single counterparty.

Pending deployment of the funds in securities in terms of investment objective of the Scheme, the AMC may park the Funds of the Scheme in short term deposits of the Scheduled Commercial Banks, subject to the guidelines issued by SEBI vide its circular dated 16 April 2007, as may be amended from time to time. The scheme may invest in government securities, or securities which are supported by the central or a state government, up to the extent of its debt/money market allocation.

NFO price: Rs 10 per unit

Entry Load: Nil

Exit Load: In respect of each purchase/switch-in of units, an exit load of 0.20% is payable if units are redeemed/switched-out on or before 15 days from the date of allotment. And no exit load is payable if units are redeemed/ switched-out after 15 days from the date of allotment.

Minimum Investment Amount: The minimum application amount under the regular plan is Rs 5000 and in multiples of Re 1 thereafter and the minimum investment amount under institutional plan is Rs 1 crore and in multiples of Re 1 thereafter.

Minimum Target amount: The Fund seeks to collect a minimum subscription amount of Rs.1 crore under each plan.

Benchmark Index: Crisil Short Term Bond Index

Fund Managers: Nitish Sikand is the fund manager for the scheme.

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