Deutsche Asset Management India has announced the launch of DWS Medium Term Income Fund, an open ended debt scheme. The investment objective is to generate income and capital appreciation by investing in a portfolio of high quality debt securities and money market instruments.
The New Fund Offer period is open from February 18 to March 04, 2014. The units will be available at par (Rs.10/-) during the NFO and at NAV related prices once the scheme reopens for subscription.
Suresh Soni, MD & CEO, Deutsche Asset Management India said, “The DWS Medium Term Income Fund is an ideal investment solution for investors, given the backdrop of recent volatility in bond markets and a deteriorating credit environment.
As a result of recent rate hikes, the medium-term bond yields have risen to attractive levels. Currently, the 3-7 year AAA bonds are trading at yields of 9.50-9.75%, a rise of almost 150 bps since June 2013. Since the volatility of this segment of market is relatively moderate as compared to long bonds, the investors have an opportunity to benefit from high accrual at relatively moderate volatility. Furthermore, over the medium-term, the investors could potentially benefit from capital appreciation in bonds, as interest rates decline. Investors keen to invest in a quality portfolio of AAA and AA rated companies may consider this fund”
The scheme offers regular plan and direct plan with growth and dividend option (sub-options dividend payout and dividend re-investment)
The minimum application amount is Rs 5,000 and in multiples of Rs 1 thereafter. Entry load charge will be Nil for the scheme. Exit Load: 1%, if redeemed/exited within 12 months of allotment of units; and Nil, if redeemed/exited subsequent to 12 months of allotment of units.
The scheme would invest 70-100% of assets in debt securities including securitized debt instruments with low to medium risk profile and 0-30% in CBLO, Reverse Repo, T Bills and Money Market Instruments instruments with low risk profile.
The Benchmark Index for the scheme is CRISIL Composite Bond Fund Index.
The fund managers of the scheme will be Nitish Gupta and Kumaresh Ramakrishnan.