New Delhi. LIC Mutual Fund Asset Management Ltd has launched a Balanced Advantage Fund. It is an open-ended dynamic asset allocation fund that can invest in equity, debt and money market instruments based on parameters such as valuation and earnings. This new fund offer (NFO) is open for subscription between October 20 and November 3.
The fund manager of LIC MF BAF will be Yogesh Patil for the equity portion and Rahul Singh for the debt portion. LIC MF BAF is benchmarked against a customized index, LIC MF Hybrid Composite 50:50 Index. In the last few years, Balanced Advantage Funds have been liked a lot by the people and there has been a boom. To pass on the equity taxation benefits to investors, the fund’s target gross equity allocation has to be 65 per cent or more.
This is because asset management companies (AMCs) use derivatives to reduce their effective equity exposure to less than 65 per cent. While maintaining the gross exposure at 65 per cent or more. If an equity-oriented mutual fund is redeemed after one year, investors are taxed at 10 per cent on capital gains exceeding Rs 1 lakh.
To get a year ago
would be 1 per cent exit load Ridempshn than a year ago, which will be charged more than 12 per cent of the allocated units. There will be no exit load after completion of 12 months from the date of allotment. Dinesh Pangte, CEO, LIC Mutual Fund said, bond yields, in a way, represent the opportunity cost and risk appetite of investing in equities. We will use its inverse relationship between Equity and Debt in LIC MF BAF to switch from Equity to Debt.
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