Quant Arbitrage Fund Files Draft with SEBI

Quant Mutual Fund has filed a draft for its Quant Arbitrage Fund with the Securities and Exchange Board of India (SEBI). This will be an open-ended arbitrage scheme, focusing on opportunities in the cash and derivatives segments of the equity market.

NFO Details

The New Fund Offer (NFO) details are as follows:

• Face Value per Unit: ₹10
• Minimum Investment: ₹5,000 (multiples of ₹1 thereafter)
• Exit Load: 0.25% if redeemed within one month, no exit load thereafter

The fund will be managed by Sanjeev Sharma, Sameer Kate, and Yug Tibrewal. They have experience in equity, derivatives, and risk mitigation strategies.

Fund Objective

The scheme aims to generate capital appreciation and income by primarily investing in arbitrage opportunities. A portion of the portfolio will be allocated to debt and money market instruments. However, there is no guarantee that the investment objective will be achieved.

Asset Allocation

• 65-100%: Equity and equity-related instruments (including derivatives)
• 0-35%: Debt and money market instruments
• Up to 10%: Units of Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs)

As per the filing, the fund will identify arbitrage opportunities, execute trades simultaneously in the cash and derivatives markets, and, when necessary, shift to debt and money market instruments.

Benchmark and Liquidity

The scheme will be benchmarked against the Nifty 50 Arbitrage TRI. Investors can subscribe or redeem units at NAV-based prices on all business days. Under normal circumstances, redemption proceeds will be dispatched within three working days.

Conclusion

All in all, the Scheme Information Document (SID) includes details about taxation, risks, and expenses. Investors should review the document before making any investment decisions. Further updates will follow after SEBI’s approval and the finalization of the NFO launch dates.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments in the securities market are subject to market risks, read all the related documents carefully before investing.