DSP Mutual Fund has launched DSP Nifty SDL Plus G - Sec Jun 2028 30:70 Index Fund, an open-ended target maturity index fund, which will mature after about six years in June 2028.
The portfolio will be invested only in sovereign securities with a 70:30 split between Government Securities (G-Sec) and State Development Loans (SDL) respectively, in line with the Nifty SDL Plus G - Sec Jun 2028 30:70 Index.
The portfolio has dual filters for selecting SDLs. Instead of just applying a Liquidity Filter, there is an additional Quality Filter of low leverage. This Quality Filter is based on each State’s GDP in proportion to its total liabilities and the top 10 States/UTs with the best quality scores will be selected. Hence, the portfolio will have a combination of highly liquid G-Secs and a selective list of SDLs with low leverage and high liquidity, all of which are maturing during the 12-month period ending June 30, 2028, states the release.
According to the fund house, the fund offers investors the potential of relatively stable and predictable returns. Long term investors (holding>3 years) can also get an additional year of indexation benefit if invested before March 31, 2022. Investors who subscribe during the NFO and remain invested till the defined maturity can get a total of 7 years of indexation benefit.
The New Fund Offer opens for subscription on March 11, 2022, and closes on March 17, 2022.