Motilal Oswal Arbitrage Fund NFO: Motilal Oswal Mutual Fund has launched a new fund offer (NFO), under which the fund house has brought an arbitrage fund for investors. Subscription in this NFO, launched in the name of Motilal Oswal Arbitrage Fund, has opened on 16 December 2024 and will remain open till 19 December 2024. After this, the scheme will be available for regular investment and redemption from December 27, 2024.
No management fees for one year
This fund is primarily designed to take advantage of arbitrage opportunities present in the cash and derivatives markets. This scheme has been specially designed for those investors who want stable returns at low risk. A major feature of the scheme is that no management fee will be charged during the first 12 months from investors investing through the direct plan. This will help in increasing returns to investors.
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Objective of NFO
The main objective of Motilal Oswal Arbitrage Fund is to provide investors the opportunity for capital growth in the long term. This fund will try to provide better returns at lower risk by utilizing the arbitrage opportunities present in the cash and derivatives segments of the market. Apart from this, some part of this scheme will also be invested in debt securities and money market instruments. Although the performance of the scheme cannot be guaranteed, its investment structure can make it a source of stable and safe returns.
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What is an arbitrage fund?
Arbitrage funds are a unique investment strategy where price differences in the market are taken advantage of. For example, when the price of a stock is different in the cash market and the futures market, this difference is used to make profits. Its biggest advantage is that whatever be the direction of the market, returns can be earned with less risk. This is the reason why it is considered a low-risk option and its risk level on the riskometer is also ‘Low Risk’. Also, from tax point of view it is kept in the category of equity fund. By investing in arbitrage funds, investors get benefits like high liquidity, low volatility and tax benefits.
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Special features of Motilal Oswal Arbitrage Fund NFO
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Fund Type: Open-Ended Arbitrage Fund
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Benchmark: Nifty 50 Arbitrage TRI
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NFO period: 16 December 2024 to 19 December 2024
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Buying and selling reopening date: 27 December 2024
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Entry Load: None
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Exit load: 0.25% on redemption within 30 days, no charge thereafter.
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Minimum investment: Rs 500
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Risk Level: Low Risk
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How safe are arbitrage funds?
Arbitrage funds are generally considered a safe investment option as their returns are not affected by market fluctuations. The main attraction of this scheme is its low risk and independence from market fluctuations. This scheme can alternatively replace liquid and debt funds. Motilal Oswal Arbitrage Fund is an attractive option for both new and experienced investors. This fund can provide stable returns to investors with low risk and provides an opportunity for wealth creation in the long term. However, before making any investment, it is better to seek expert advice keeping in mind your risk tolerance and financial goals.
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Who can invest?
This NFO is a better option for those investors who are looking for stable returns and want to invest with less risk. Due to the tax benefits like equity funds, this scheme is also suitable for investors who want stable income in the long term as well as tax savings.
(Disclaimer: The purpose of this article is only to provide information, not to give investment advice. Take investment decisions only with the advice of your investment advisor.)
