In order to beat the sharp swings, Edelweiss Wealth Management has launched a long short AIF scheme called Edelweiss Dynamic Growth Equity (EDGE) Fund to help beat market volatility and generate consistent returns.
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Volatility in markets has risen sharply with the volatility index, India VIX, zooming by nearly 22.93% on Friday. Elevated volatility levels witnessed over the last one year can lead to an erosion of investor wealth. In order to beat the sharp swings, Edelweiss Wealth Management has launched a long short AIF scheme called Edelweiss Dynamic Growth Equity (EDGE) Fund to help beat market volatility and generate consistent returns.
The AIF, which is targeted towards high net worth individuals, family offices and institutional investors, is looking to raise Rs 1,000 crore. The open-ended, category III AIF plans on capitalising on market dynamics by participating in both long and short side opportunities. The instruments that the fund would invest in consists of cash equities, stock and index derivatives — including futures and options. The fund, according to Edelweiss Wealth Management, will follow a target-based investment approach and employ complementary strategies to smoothen returns across market cycles while limiting drawdowns during periods of extreme volatility.
Nitin Jain, managing director and chief executive officer, Edelweiss Wealth Management, said, “We believe it’s necessary to have a bifocal approach to investing in order to protect our portfolios against market volatility while generating wealth consistently over the long term. EDGE offers this niche investing strategy and an excellent diversification proposition to investors in comparison to other options available for investments.”
The fund has a minimum investment amount of Rs 1 crore and with an expected corpus of Rs 1,000 crore, the fund will include a portfolio of about Rs 15-20 core long-term holdings, mix of long-short strategies and will follow systematic hedging practices.