June 29, 2021 - Invesco Mutual Fund announces the launch of its new fund Invesco India Medium Duration Fund - An open-ended medium term debt scheme investing in instruments such that the Macaulay duration^ of the portfolio is between 3 years and 4 years. The New Fund Offer (NFO) is open for subscription from June 29, 2021 and will close on July 13, 2021.
Invesco India Medium Duration Fund seeks to generate income by investing in a portfolio of debt and money market securities. Fund would be constructed following a detailed assessment of liquidity, interest rate view and credit environment.
Over 75% - 85% of exposure will be to ‘AAA’ rated Corporate and Government Securities (G-Secs including SDLs).With an aim to enhance portfolio yield, the fund will invest 15% - 25% of the net assets in very select ‘AA’ category corporate bonds and will utilize its in-house proprietary credit assessment framework to select such issuers. The fund will also aim to identify issuers, which are expected to witness improvement in their credit metrics. Such selected issuers will not only provide the benefit of high accrual to begin with but also the mark to market gains opportunity with credit spread compression. The fund will not invest in bonds which are rated below AA-. At all times, the Scheme will target securities, which can offer an optimal level of yields/returns, while giving due emphasis to its risk-reward characteristics^.
Mr. Saurabh Nanavati, Chief Executive Officer, Invesco Mutual Fund said, “Fixed-income investments play a vital role in every investment portfolio, besides generating stable income they also help in reducing overall portfolio risk as they are less volatile and have a low correlation with equity market returns.” “New Fund Launch is aimed at capturing the current market opportunities both on the yield curve as well as on the credit market. If you look at the current fixed income markets, the yield curve has steepened during pandemic;at the short end, yields have moved sharply lower on account of ample systemic liquidity & accommodative monetary policy stance; while the long end of the curve has still remained elevated due to higher fiscal concerns, though anchored by RBI through various tools like Government Securities Acquisition Program (G–SAP). With this backdrop in mind, we believe the 3- 5 years segment which offers high accrual presents itself as an attractive investment opportunity from risk-reward perspective. Investors with a medium to a long term horizon with moderate risk appetite can consider investing in this fund.” The minimum investment amount during the NFO is Rs. 1,000/- and in multiples of Rs. 1/- thereafter. For SIP investments, the minimum application amount is Rs. 1,000/- per month and Rs. 2,000/- per Quarter and in multiples of Rs. 1 thereafter. No Exit load will be charged. The fund is benchmarked to CRISIL Medium Term Debt Index and will be managed by Vikas Garg and Krishna Cheemalapati.
Invesco India Medium Duration Fund (An open ended medium term debt scheme investing in instruments such that the Macaulay duration^ of the portfolio is between 3 years and 4 years) Suitable for investors who are seeking* Income over medium term Investments predominantly in debt and money market instruments with portfolio Macaulay Duration of 3- years *Investors should consult their financial advisers if in doubt about whether the product is suitable for them Note: The product labelling assigned during the NFO is based on internal assessment of the Scheme characteristics or model portfolio and the same may vary post NFO when the actual investments are made.
^Please refer to the heading ‘C. Asset Allocation Pattern’ under Section ‘II. Information about the Scheme’ of Scheme Information Document where the concept of Macaulay duration has been explained Mutual Fund investments are subject to market risks, read all scheme related documents carefully.