Canara Robeco InDiGo Fund
Another NFO which opened up for public is the Canara Robeco InDiGo Fund. InDiGo expands as INcome from Debt Instruments and Gold. This is an open ended debt fund from Canara Robeco Mutual Fund House. It opened for public on May 19, 2010 and this NFO will close on June 10, 2010.
This fund, Indigo Mutual Fund, as the name suggests is going to primarily invest in debt instruments as well as in gold which makes it extra special at least according to Canara Robeco MF. They claim that they would, via this InDiGo Fund, would invest like a grandmother where most of them invest their money in gold and rarely in fixed income schemes and this fund’s focus is primarily explained via that promo of theirs which can be seen everywhere else in Chennai.
Investment Objective: Generating income primarily from a portfolio that is mainly consisting of debt and money market instruments as well as investment in gold ETFs.
Asset Allocation: Indian debt and money market securities 65% to 95% and gold ETFs 10% to 35%. Hence the risk Profile is low to medium.
Investment Options: Growth and quarterly dividend option (both payout and reinvestment).
Benchmark Index: CRISIL Short Term Bond Fund Index plus Price of Gold.
Load Structure: No entry load but the upfront commission will be paid by the investors to their advisors or investment brokers. Exit load will be 0.5% if redeemed or switched within 6 months and nil after 6 months. The NAV during NFO for Canara Robeco InDiGo Fund will be Rs. 10 and when reopened it will be based on the existing NAV on a daily basis.
Minimum Amount: Rs. 5000 and multiples of Rs. 1 thereafter and Rs. 1000 and Rs. 1 thereafter for additional purchases.
Opinion: Since being a debt fund with gold this is a moderate to low risk fund and hence the returns too will not be as high as its counterpart funds from pure equity based funds. This fund, Canara Robeco Indigo Fund, primarily invests in money market instruments like government securities, treasury bills, commercial bills, certificate of deposits, bonds, and other related instruments brought on by Reserve Bank of India and SEBI every now and then. Also when it comes to Gold ETF, this fund will primarily invest in Indian based Gold ETFs listed in Indian Stock Exchanges.
If you are an investor whose primary investment portfolio mostly consists of fixed income and gold, Canara Robeco InDiGo Mutual Fund does the same but via the expert fund manager and hence you can start to divert your or take your first step towards mutual funds via this fund and gradually go forward in other regular equity based mutual funds (primarily large cap but also mid to small cap funds). Since being a low risk and low returns fund, it is up to the investors appetite whether to go for it or not. But primarily a low to medium risk fund and hence can be given a thought if you are looking to diversify your portfolio.
Canara Robeco InDiGo Mutual Fund’s scheme document can be obtained from here.
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