Union Mutual Fund to launch a new NFO in the gilt fund category : Union Gilt Fund NFO
Union Mutual Fund is launching a Gilt Fund, Union Gilt Fund, that invests in government securities across maturities.
The New Fund Offer (NFO) period for the Union Gilt Fund is from July 18th 2022 to August 1st 2022. The scheme re-opens for subscription on August 17th 2022.
The Union Gilt Fund aims to generate income through investing in a portfolio that comprises of government securities of various maturities. However, there is no assurance that the scheme’s investment objective will be achieved.
|Union Gilt Fund||Details|
|NFO Opening Date||July 18th 2022|
|NFO Closing Date||August 1st 2022|
|Re-open Date||August 17th 2022|
|Type of Fund||Open-ended debt scheme|
|Fund Manager||Mr Parijat Agrawal|
|Minimum Investment Amount||INR 1,000|
|Minimum Additional Purchase Amount||INR 1,000|
|Benchmark||CRISIL Dynamic Gilt Index|
|Plans and Options||Direct and Regular Plans, Growth and Income Distribution cum Capital Withdrawal (IDCW) Option|
Who Can Invest?
Union Gilt Fund is an open-ended debt scheme that invests in government securities across different maturities. The securities have a relatively high-interest rate risk and relatively low credit risk. The Union Gilt Fund’s benchmark index is CRISIL Dynamic Gilt Index. Furthermore, the fund aims to generate credit risk-free returns over the medium to long term.
Since the Union Gilt fund invests across government securities in India, it is a moderate risk investment. Thus, it is primarily meant for investors seeking medium to long-term wealth creation.
Therefore, investors seeking exposure to government securities and are moderate risk-takers can look at this scheme. However, one must have a medium to long-term investment horizon (3+ years).
Popular Funds by Union Mutual Funds
- Union Long Term Equity Fund
- Union Flexi Cap Fund
- Union Midcap Fund
- Union Small Cap Fund
- Union Hybrid Equity Fund
Mr Parijat Agrawal
Mr Parijat Agrawal has more than 26 years of industry experience. He is currently the Head – Fixed Income of Union Asset Management Company Private Limited. Prior to joining Union AMC, he was with SBI Mutual Fund, State Bank of Mauritius Limited, and SUN F&C Asset Management. Mr Agrawal holds a B.E. (Electronics & Communications) degree and also PGDM from IIM Bangalore.
Union Gilt Fund invests in government securities across different maturities. The following is the indicative asset allocation of the fund.
|Types of Instruments||Indicative Allocation Minimum||Indicative Allocation Maximum||Risk Profile|
|Central and State Government securities, Treasury Bills and Cash Management Bills of Government of India||80%||100%||Sovereign|
|Cash, Money Market & Debt instruments||0%||20%||Low|
Union Gilt Fund invests across government securities with different maturities. The securities have a relatively high-interest rate risk and also low credit risk. Investments are made in sovereign-rated instruments (Government Securities), thus minimizing the credit risk in the portfolio.
The fund manager will seek to generate returns with minimal credit risk by investing in a portfolio comprising of securities issued and guaranteed by the Central and State governments and ensuring the securities are in line with the asset allocation pattern of the Scheme.
Thus, it is a moderate-risk investment option as per the riskometer. Investors must have a medium to long-term investment approach while considering Union Gilt Fund.
Investors who wish to invest in moderately risky funds and seek stable returns can consider the scheme. Furthermore, the scheme is primarily meant for investors looking for exposure to debt instruments like government securities. Since it is a pure debt scheme and invests in sovereign guaranteed securities, a medium to long-term investment horizon is necessary.
Frequently Asked Questions
You can invest in the Union Gilt Fund NFO through any of the following methods:
Offline: By filling out the Union Gilt Fund NFO application and submitting it along with all documents and cheques to the nearest Investor Service Center of CAMS or Union mutual fund office.
1. Union Mutual Fund Website
2. Online FinTech platforms and mutual fund platforms
3. Through demat account
4. Through a mutual fund distributor or agent
The index fund will re-open for subscriptions, switches and redemptions from the date August 17th 2022.
The fund is classified as moderately-risky as per riskometer. Union Gilt Fund is a pure debt mutual fund that invests in government securities across different maturities. Since the securities have a relatively high-interest rate risk and low credit risk, the scheme doesn’t guarantee returns to investors. Therefore, investors who understand the risk associated with these government securities can consider the fund.
No, Union Gilt Fund doesn’t have a lock-in period.