NFO Alert: Baroda BNP Paribas Mutual Fund launches multi asset active fund of funds

Baroda BNP Paribas Mutual Fund has launched a new offering Baroda BNP Paribas Multi Asset Active Fund of Funds, a strategically diversified investment solution tailored for first time as well as seasoned investors.

The new fund offer or NFO of the scheme is open for subscription and will close on May 26.

This actively managed Fund of Funds provides an allocation across three asset classes. It allocates a minimum 55% (will always be <65%) in units of debt oriented schemes and money market instruments, subject to maximum 5% investment (Invest in Baroda BNP Paribas Short Duration Fund), the scheme shall invest a minimum of 15% (and maximum allocation <25%) of the allocation in units of equity based schemes. (Invest in Baroda BNP Paribas Large Cap Fund), The scheme shall invest balance of (minimum 15% and maximum 25%) in Units Baroda BNP Paribas Gold ETF.

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The fund will be co-managed by Prashant Pimple and Pratish Krishnan.

“The mix of different asset classes in this single-stop solution provides diversification of low correlated asset classes, leading to potentially better risk-adjusted returns — especially valuable for conservative investors. Investors in this scheme will benefit from an active asset allocation with a diversified exposure that aims to deliver stability and growth.” said Prashant Pimple, CIO Fixed Income, Baroda BNP Paribas AMC.

Designed with long-term tax efficiency in mind, the scheme offers a concessional long-term capital gains (LTCG) tax rate of 12.5% on investments held for more than two years, while short-term gains are taxed at slab rates, providing better post-tax returns for long-term savers.

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Investors are requested to note that they will be bearing the recurring expenses of the fund of funds scheme in addition to the expenses of the underlying fund(s) in which the fund of funds scheme makes investment, according to a press release by the fund house.

With medium to long term prospects for all 3 asset classes, the fund proposes to invest across debt, equity and gold schemes, allowing investors to score a hat trick in a single shot. This fund may be considered as one of the ideal choices for investors looking for a tax-smart, low-volatility investment with potential for long-term capital appreciation, the release said.

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