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Bandhan Mutual Fund has launched FOF investing in international debt passive fund - Bandhan US Treasury Bond 0-1 Year Fund of Fund. This is India’s first passive debt fund in international space.
It is an open-ended fund of fund scheme investing in units of overseas index funds and ETF which track an index with US treasury securities in the 0-1 year maturity range as its constituents.
In a press release, Vishal Kapoor, CEO, Bandhan MF said, “The fund invests in US Treasuries with 0 to 1-year maturity, which means it offers a much-needed blend of relatively high-quality and low-volatility investment opportunity. Currently, mutual funds offered global diversification via equity-oriented funds but this fund is another step in offering opportunities via debt-oriented fund. Additionally, the spread between the US and India's 1-year government bond yields has narrowed significantly from ~390 bps to ~227 bps since February 2022, clearly demonstrating that exposure to US treasury bonds is relatively more attractive for Indian investors.”
The underlying index of the fund is JPMorgan BetaBuilders US Treasury Bond 0-1 year UCITS ETF. The fund will be benchmarked against the ICE 0-1 Year US Treasury Securities Index.
