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This article is more than 3 month old.

SBI MF mobilises Rs 12,000 crore in highest ever NFO

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SBI MF mobilised over Rs 12,000 crore in its MFO. It is the largest amount any MF in India has accumulated. SBI's MF collection beats that of ICICI Prudential Asset Management Company's Flexi-cap fund NFO.

SBI MF mobilises Rs 12,000 crore in highest ever NFO
State Bank of India (SBI) Mutual Fund, the largest fund house in India in terms of money under management, has mobilised over Rs 12,000 crores in the new fund offer (NFO) stage of its Balanced Advantage Fund. The NFO started on August 12 and ended on August 25.
This is the largest amount any MF in India has mobilised. SBI's MF collection beats ICICI Prudential Asset Management Company's Flexi-cap fund NFO. Total money invested in the ICICI Pru's NFO by all investors added up to Rs 10,000 crore.
However, according to SBI MF executives, it will take a few more days to reconcile and arrive at the final mobilisation figure.
SBI MF had introduced a unique percentage withdrawal feature to provide a steady stream of cash to investors, Mint reported. It means investors can withdraw 0.5 percent of the invested amount every month, three percent every six months, and six percent every year. However, if the investors withdraw this amount, the fund would not deliver returns above these rates. And the withdrawals would come from the investors' capital.
SBI MF is a Balanced Advantage Fund (BAF), called SBI Balanced Advantage. It is an open-ended dynamic asset allocation (DAA) fund created after SEBI's new categorisation rules. Per these rules, BAF can modify its allocation to debt and equity according to market conditions. And since it is open-ended, investors can subscribe to it later as well.
BAF/DAA has the potential to navigate volatile markets through debt and cash exposure while holding enough equity during good times to do better than fixed-income alternatives. Such funds do not just invest in equity, they hedge through equity through derivatives and debt.
SBI Balanced Advantage will use parameters such as the breadth of the market, retail participation, primary market activities, mutual fund flows, valuations, and earnings drivers to decide the levels of debt, derivatives, and unhedged equity.


 
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