Axis Mutual Fund launches ‘Axis US Treasury Dynamic Bond ETF Fund of Fund’
(An open-ended fund of fund investing in ETFs wherein the underlying investments comprise of US treasury securities across duration)
• Category: An open-ended fund of fund investing in ETFs wherein the underlying investments comprise of US treasury securities across duration
• Benchmark: Bloomberg US Intermediate Treasury TRI
• Fund Managers: Vinayak Jayanath
• NFO open date: 12th December 2023
• NFO close date: 19th December 2023
• Minimum Application Amount: Rs. 500 and in multiples of Rs. 1/- thereafter
• Exit Load:
o If redeemed/switched-out within 1 month from the date of allotment: 0.25%
o If redeemed/switched-out after 1 month from the date of allotment: Nil
Mumbai: Axis Mutual Fund, one among the fastest growing fund houses in India announces the launch of its latest fund offering, the ‘Axis US Treasury Dynamic Bond ETF Fund of Fund’. Benchmarked against the Bloomberg US Intermediate Treasury TRI, the primary investment objective of the scheme is to provide regular income by investing in units of overseas ETFs where the investment mandate is to invest in US treasury securities across duration. However, there can be no assurance that the investment objective of the Scheme will be achieved. The fund will be managed by Mr. Vinayak Jayanath.
B. Gop Kumar, MD & CEO of Axis AMC, stated, “The global economic landscape is evolving rapidly, and US Treasuries present a compelling investment avenue in this context. They have been at historic highs recently due to significant expansion of the US Fed balance sheet and an easy monetary policy stance for the last 2.5 years. Furthermore, the current market conditions warrant allocation to duration assets. In such an environment, the Axis US Treasury Dynamic Bond ETF Fund of Fund has been conceptualized with the aim to enable investors to leverage global opportunities.”
Key features of the Axis US Treasury Dynamic Bond ETF Fund of Fund
The scheme will aim to allocate 95-100% of its instruments in units of overseas ETFs wherein the underlying investments comprise of US treasury securities (residual maturity of the underlying securities in which investments shall be made shall not exceed 15 years) and the remaining 0-5% in debt and money market instruments. The indicative list* of overseas Exchange Traded Funds in which the Scheme proposes to invest is as follows:
• iShares Short Treasury Bond ETF
• iShares 1-3 Year Treasury Bond ETF
• SPDR® Bloomberg 1-10 TIPS ETF
• iShares 7-10 Year Treasury Bond ETF
The scheme will predominantly follow an active investment strategy for investments in the overseas mutual funds. The fund is designed to dynamically adjust to market fluctuations, aiming to capitalize on the expected yields and minimize risks. This fund has the potential to be an ideal addition for those looking to diversify their portfolio for international exposure. This dynamic management approach allows the fund to adapt to changing macroeconomic conditions, targeting both capital appreciation and income generation opportunities.
Ashish Gupta, CIO, Axis Mutual Fund, added, “Dynamic allocation is pivotal in today’s ever-changing economic landscape, and the Axis US Treasury Dynamic Bond ETF Fund of Fund embodies this principle. As market cycles vary, the need to pivot allocations becomes essential. Our fund is strategically designed to respond to these fluctuations, aiming to maximize the risk-return profile for our investors by actively managing strategies across different segments of the US G-Sec yield curve.”
In a world of shifting market dynamics, the Axis US Treasury Dynamic Bond ETF Fund of Fund offers a forward-looking investment solution. With its strategic focus on dynamic allocation and global market insights, the fund positions itself as an essential component for investors seeking to diversify and strengthen their portfolios in the face of global economic shifts.
This new fund offer (NFO) is set to open for subscription on December 12, 2023, and will remain open until December 19, 2023.