Thematic Fund Filed with SEBI- UTI Active Factor Equity Fund

Introduction

UTI Mutual Fund has filed a draft with SEBI for a new thematic equity fund called the UTI Active Factor Equity Fund. This open-ended fund aims to achieve long-term capital appreciation by investing primarily in equities and equity-related instruments. Let’s dive deeper into what makes this fund a potential addition to your investment portfolio.

Fund Overview

Fund Name: UTI Active Factor Equity Fund
Category: Thematic Fund
Scheme Type: Open-ended equity scheme
Objective: The fund seeks to generate long-term capital appreciation by investing in equities using a factor-based integrated investment theme. This means the fund follows strategies that focus on various investment styles, like momentum, low volatility, value, and growth.

Who Manages the Fund?

The fund is managed by Mr. Sharwan Kumar Goyal, who has extensive experience in equity fund management, particularly in passive, arbitrage, and quant strategies. For overseas investments, the fund manager is Mr. Deepesh Agarwal, a seasoned professional in managing global assets.

Benchmark Index

The BSE 200 TRI (Total Return Index) serves as the benchmark index for this fund, reflecting the objective to capture returns through a diversified investment in Indian equities.

Asset Allocation

The asset allocation for this scheme is focused primarily on equities, but it also allows flexibility for investing in debt and money market instruments to provide stability. Below is the indicative allocation:

• Equity and equity-related instruments: 80-100%
• Debt and money market instruments: 0-20%
• Units issued by REITs and InvITs: 0-10%

The scheme will also participate in stock lending, derivatives, and other SEBI-permitted instruments, allowing dynamic portfolio management to enhance returns.

Fund Features

• Liquidity: Units can be subscribed and redeemed at NAV on any business day.
• Growth Option: The scheme offers only a growth option, where all profits are reinvested to grow the fund value.
• Minimum Investment: Initial investments start at ₹1,000, with Systematic Investment Plans (SIPs) starting at ₹500 per month.

Key Strategies

The UTI Active Factor Equity Fund follows an integrated factor-based investment strategy. It aims to combine both fundamental research and factor analysis. Factors like momentum, value, and low volatility are applied to the selection process to identify opportunities that align with the market environment.

This approach helps adjust exposure to different styles dynamically, allowing the fund to adapt during various market cycles and enhance the potential for capital appreciation while effectively managing risk.

Who Should Invest?

This fund is suitable for investors looking for long-term capital growth with an interest in a factor-based equity investment approach. Given its thematic nature, the fund may appeal to investors who understand market cycles and are comfortable with higher risks in pursuit of potentially higher returns.

Dreaming of financial freedom? Use our Mutual Fund SIP Calculator to see how regular investments can add up to grow wealth. Take the first step towards your goals. Calculate now!

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.