The new fund offer opened for subscription on October 17 and closes on October 31.
After Deutsche and HDFC, SBI Mutual fund has come out with its open end Inflation Indexed Bond (IIB) fund.
As the name suggests, this fund will invest a minimum of 70% of its corpus in IIBs issued by the government and a maximum of 30% in debt and money market instruments.
These bonds have tenure of 10 years and are linked to wholesale price inflation (WPI). IIBs are meant to provide a hedge against inflation.
DP Singh, SBI Mutual Fund said, “The rationale behind launching this fund is to provide real returns to the investors.”
The NFO opened for subscription on October 17 and closes on October 31. The scheme aims to generate capital appreciation and income by investing in inflation indexed securities. Benchmarked against I-sec Composite Index, the scheme has an exit load of 1% if redeemed within 1 year from the date of allotment.
Dinesh Ahuja is the fund manager of the scheme.
SBI Mutual Fund manages Rs. 72,850 crore as on September 2014.
