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Thursday, September 17, 2009

IDFC Asset Allocation Fund of Fund files offer document with Sebi

An open-ended fund of fund scheme

IDFC Mutual Fund has filed an offer document with Securities and Exchange Board of India (SEBI) to launch IDFC Asset Allocation Fund of Fund, an open-ended fund of fund scheme. The new fund offer (NFO) price for the scheme is Rs.10 per unit.

The primary investment objective of the scheme is to generate capital appreciation through investment in different mutual fund schemes based on a defined asset allocation model covering both local and offshore assets.

The scheme will offer 3 different plans - Conservative Asset Allocation plan (Conservative AA Plan), Moderate Asset Allocation plan (Moderate AA Plan) and Aggressive Asset Allocation plan (Aggressive AA plan) that will offer 3 different risk profiles for investors. Conservative AA Plan will target the lowest risk profile followed by Moderate AA Plan. Aggressive AA will be the highest risk profile asset allocation.

Each plan offers both growth option and dividend option (payout and reinvestment).

The Conservative AA Plan will invest 10-15% in equity funds, 45-50% in debt funds, 45-50% in money market funds, 0% in alternate and 0-15% in money market securities.

Moderate AA Plan will invest 25-30% in equity funds, 60-70% in debt funds, 0-5% in money market funds, 5-10% in alternate and 0-15% in money market securities.

Aggressive AA Plan will invest 45-50% in equity funds, 35-45% in debt funds, 0-5% in money market funds, 10-15% in alternate and 0-15% in money market securities.

Alternate, It will consist of allocations to offshore commodity equity funds as well as domestic Gold ETFs.

The minimum application amount for all plans (non SIP purchases) is Rs 5,000 and in multiple of Re 1 for purchases and in multiples of Re 0.01 for switches. SIP purchase - Rs 1000 (subject to minimum of 6 installments of Rs 1000 each).

The fund seeks to collect a minimum subscription amount (plan level) of Rs. one crore under the scheme during the NFO period.

The scheme will charge no entry load. But an exit load of 0.25% of the NAV shall be applicable if investors who redeem / switch out such investments within 3 months from the date of subscription applying First in First Out basis, (including investments through SIP/STP). The schemes performance would be benchmarked against Crisil MIP Blended Index. The scheme will be managed by Ashwin Patni.

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