Union Asset Management Company has launched a new mutual fund scheme on 19th July 2018 – Union Equity Savings Fund. It is an open-ended scheme that invests in equity, arbitrage, and debt.
Union Equity Savings Fund NFO- Facts
Union mutual fund is a premier mutual fund in India and caters to the investment needs through a suite of mutual fund schemes.
It recently announced the launch of Union Equity Savings Fund – Direct Plan NFO.
|NFO Name||Union Equity Savings Fund – Direct Plan NFO|
|NFO Launch Date||19th July 2018|
|Last Date for Application||30th July 2018|
|Minimum Investment Amount||₹5,000 and in multiples of ₹ 1 thereafter|
|Fund Type||Equity Saving Fund|
|Load Structure||Entry Load: Nil
Exit Load: 1% if units are redeemed / switched out within 1 year from the date of allotment.
|Fund Manager||Mr. Vinay Paharia|
|Benchmark||CRISIL Short Term Debt Hybrid 75+25 Fund Index|
How Can You Invest in Union Equity Savings Fund NFO 2018?
Log in to your Groww account.
If you are a new user, sign up first– it is online and takes 2-3 working days.
If you want to invest in Union Equity Savings Fund-Direct Plan NFO, you have to follow the steps below:
1.Decide the amount you would like to invest in Union Equity Savings Fund – Direct Plan NFO.
2.You can also email Groww support on email@example.com with a request.
When investing in this NFO, you must remember that there is no entry load, but the exit load is 1% if the units are redeemed/switched within 1 year from the date of allotment.
Union Equity Savings Fund NFO- Objective
To seek capital appreciation and generate consistent returns by actively investing in a combination of diversified equity and equity related instruments. And also to derive exposure in debt and money market instruments.
But there is no assurance that the objective of this scheme will be realized and the scheme does not assure or guarantee any consistent return either.
Union Equity Savings Fund NFO- Fund Category
Union Equity Savings Fund-Direct Plan NFO is categorized as a hybrid fund scheme under the equity saving fund category.
Hybrid funds are investment instruments, where an asset management company invests money in both, debt and equity. These are broadly of two types, equity-oriented balanced funds and debt oriented balanced funds.
Union Equity Savings Fund scheme invests in equity, arbitrage, and debt.
Union Equity Savings Fund NFO- Plans Available
The scheme offers the following plans: Regular Plan and Direct Plan.
Both the regular and direct versions of any mutual fund are the exact same fund and are run by the same fund managers, investing in the same stock and bonds.
The difference is that in the case of direct mutual funds, there is no broker/distributor commission.
Which means, as an investor, you get higher returns from the exact same mutual fund.
- Growth Option
- Dividend Option with Reinvestment, Payout and Sweep Facility
If no option is indicated in the application form, then the default option will be the Growth Option.
Union Equity Savings Fund NFO- Asset Allocation
The fund has to do a minimum investment in equity & equity related instruments – which is 65% of total assets and a minimum investment in debt – which is 10% of total assets.
Union Equity Savings Fund- Direct Plan NFO Asset Allocation:
|Un-hedged Equity||Equities including
|Exposure||10%-40%||65%-90%||10% – 35%|
|Definition||Capital Appreciation through
investment in diverse universe of stocks
|Regular Income by buying securities in cash and selling futures of same securities thus exploiting inefficiencies in securities pricing||Stability through investment
in high-security fixed income
Note: For complete details of the asset allocation pattern, refer the Scheme Information Document (SID) of the
Union Equity Savings Fund NFO- Benchmark
The fund will be bench-marked to CRISIL Short Term Debt Hybrid 75+25 Fund Index. The performance of the Scheme will be benchmarked to the Total Return variant of the Index (TRI).
This index is a combination of the S&P BSE 200 (25%) and Crisil Composite Bond Index (75%).
CRISIL Research, India’s largest independent and integrated research house, has launched three hybrid indices and changed its methodology for all existing hybrid indices to migrate to the total return variant in order to align with Securities Exchange Board of India’s guidelines released on January 4.
The Fund reserves the right to change the benchmark for evaluation of the performance of the Scheme from time to time, subject to SEBI Regulations and other prevailing guidelines if any.
Union Equity Savings Fund NFO- Fund Manager
This fund will be managed by Mr. Vinay Paharia.
Union Asset Management Company Private Limited (“Union AMC”) recently appointed Mr. Vinay Paharia as the Chief Investment Officer (CIO).
Vinay Paharia has over 15 years of experience, covering the entire gamut of research and fund management.
In his earlier role, he has worked with Invesco Asset Management (India) Private Limited as Fund Manager-Equity, where he has been successfully managing various equity mutual fund schemes.
Mr. Paharia holds a B. Com degree from Narsee Monjee College and an M.M.S. degree from Welingkar Institute of Management, Mumbai.
Union Equity Savings Fund NFO- Minimum Investment
- Minimum Application Amount: ₹5,000
- Minimum Additional Investment: ₹ 1,000
- Minimum Redemption Amount: ₹1,000
- For Systematic Investment Plan (SIP);
1. ₹2,000 (for monthly frequency)
2. ₹5,000 (for quarterly frequency)
Union Equity Savings Fund NFO- Risk
Union Equity Savings Fund-Direct Plan, NFO falls in the ‘moderate risk category’. This indicates that the principal invested by the investors will be moderately high risk.
Some risks associated with this fund are trading volumes, settlement risk, liquidity risk and default risk, including the possible loss of principal.
The fund is an equity oriented hybrid fund and therefore, it is less volatile when compared to pure equity funds and more volatile than debt mutual funds.
These categories of funds give a high return on investment, when compared to debt funds.
It is best suited for investors with a moderate risk appetite or for long-term investors.
Union Equity Savings Fund NFO- Important Features
- The Growth potential is better than fixed income investments;
- Lower volatility as compared to pure equity funds;
- Dynamic Equity & Debt Allocation based on Multi Parameter Strategy
Union Equity Savings Fund NFO- AMC Details
Union Mutual Fund is sponsored by Union Bank of India and Dai-ichi Life Holdings, Inc.
Union Bank of India
Union Bank of India is one of the leading public sector banks in India, registered on November 11, 1919 as a limited company and is headquartered in Mumbai.
The Bank has a network of about 4298 domestic branches, 4 foreign branches, 3 representative branches and over 30 million customers.
Moreover, all of these branches are integrated under the Core Banking Solution. Union Bank of India is the first large public sector bank in the country to have implemented 100% networking of branches.
Dai-ichi Life Holdings, Inc.
Dai-ichi Life Holdings, Inc. (“Dai-ichi Life”) is a stock company with limited liability, incorporated under the laws of Japan in the year 1902 and listed on the Tokyo Stock Exchange.
Dai-ichi Life is a financial services holding company engaged in carrying out both insurance and non-insurance (including asset management) businesses through various subsidiaries and affiliated companies.
Over the past 10 years, Dai-ichi Life has expanded its business globally and is currently engaged in the life insurance sectors of 6 jurisdictions other than Japan. In addition to the life insurance business, Dai-ichi Life is also engaged in the business of asset management and has setup a trilateral business structure to cover the asset management markets of Japan, Europe and USA.
Dai-ichi Life carries out asset management business in Japan and overseas through its group company /affiliates, Asset Management One Co. Ltd. and the Janus Henderson Group. Asset Management One Co. Ltd. and Janus Henderson Group are emerging global asset management companies that provide customers with high quality products and services. Dai-ichi Life is a committed and reputable player in the insurance and asset management business.
Pursuant to this investment, Dai-ichi Life Holdings, Inc. holds more than 40% of the networth of Union Asset Management Company Private Limited. Consequently, Union Bank of India and Dai-ichi Life Holdings, Inc. have become Co-sponsors of Union Mutual Fund.
Key Reasons to Invest in Union Equity Savings Fund NFO
Conservative investors who are trying to seek income from their investment and not take a great risk, should look at this NFO.
Equity Savings funds are desirable funds for conservative investors seeking reasonable returns with great stability.
Advantages of Equity Saving Funds
- Highly diversified when compared to other equity-oriented mutual funds.
- Low volatility and low risk as compared to investing in equity funds alone.
- Tax benefits as applicable to equity funds.
- They have given more return on investment than pure debt-oriented balanced funds.
- Balanced funds provide the fund manager with the flexibility of changing the debt and equity proportion, depending upon the market situation.
- It enables the fund manager to book profits when the market is rising and purchase stocks at a cheaper price when the market is falling.
- The investor also does not need to re-balance his portfolio as it is done by the fund manager.
What are Your Other Options?
If you think Union Equity Savings Fund – Direct Plan is too new and lacks a track record, you can invest in equity saving funds that have been in the market for some time. Top options in equity saving category are:
Launched on 24th November 2014, this is a fund with moderate risk and has given a return of 9.06% since its launch.
Returns from this fund over the years
|Duration||Returns (per annum)|
- This is a 5-star rated fund by Groww.
- It has an AUM of ₹ 1,463 Cr approximately
- It has consistently outperformed its benchmark, NIFTY 50 Arbitrage TRI (40), CRISIL Short-Term Bond (30), S&P BSE 200 TRI (30), since its launch.
- Minimum SIP – ₹500.
Launched on 1st January 2013, this is a fund with moderate risk and has given a return of 9.06% since its launch.
Returns from this fund over the years
|Duration||Returns (per annum)|
- This is a 4-star rated fund by Groww.
- It has an AUM of ₹ 7,445 Cr approximately
- It has consistently outperformed its benchmark, NIFTY 50 Arbitrage TRI (40), NIFTY 50 Total Return (30), CRISIL Short-Term Bond (30), since its launch.
- Minimum SIP – ₹500.
There are many myths and false beliefs about mutual funds circulating in the markets from time to time. The most successful investors are the ones who ignore these myths and remain invested.
Investing in mutual funds online is very simple and paperless. Simply log in to your Groww account, choose a fund, and invest using net banking – exactly like you would when shopping online.
Also Read: 5 Best Balanced Funds to Invest In
Disclaimer: The views expressed in this post are that of the author and not those of Groww