The fund seeks to offer geographic
diversification to domestic investors by investing in US which has a low
correlation with the Indian market.
ICICI Prudential US Bluechip Equity Fund
is a diversified equity fund that seeks to provide long-term capital
appreciation by primarily investing in companies listed on the New York Stock
Exchange and NASDAQ. The NFO opened on 18th June and will close on
The fund has a target investment list of
20 to 25 stocks. It will have in place sectoral and stock specific limits. The
US Bluechip Fund will target companies with a market cap in excess of $4 billion.
The benchmark for the fund will be the S&P 500.
The fund will invest a minimum of 65% in
equity and equity related securitiesof blue-chip companies listed on the NYSE and
NASDAQ and a maximum of 35% of its assets in fixed income securities in India and
the US including money market instruments, cash and equivalent, treasury bills
and fixed deposits. The scheme will not invest in derivatives or securitized
debt. It may invest in ADRs and GDRs issued by Indian and foreign companies.
The fund house has appointed Morning
Star as research partner and has entered into a three-year arrangement. Morning
Star will provide research analysis for the US market.
According to the AMC, the fund seeks to
give Indian investors the opportunity to invest in foreign stocks which would
have otherwise been difficult for an investor. All purchases and redemptions for investors
will in rupees. Since it won’t invest in
Indian equity, the fund will be taxed like a fixed income scheme.
Speaking on the fund in a press meet, Nimesh Shah, MD
& CEO, ICICI Prudential AMC said, “The launch of the fund will illustrate
our focus on making available all meaningful investment products to Indian
Sankaran Naren CIO – Equity said that with the current valuations of US equities
being attractive, the fund has a more compelling appeal to investors. He added
that the S&P 500 was more appropriate for this fund as the NASDAQ is
technology focused and the Dow is not a weighted market cap index.
Himanshu Pandya, VP & Head –
Products and Communication said, “The fund will have
meaningful diversification as there is low correlation between Indian equity
and US equity markets.”
The dedicated fund manager for US investments will be Atul
Patel with Chaitanya Pande managing the investments in Indian fixed income