At times, many mutual funds impose restrictions on fresh inflows into the scheme. Edelweiss Recently Listed IPO Fund, an open ended equity mutual fund has decided to limit the subscriptions on a prospective basis in the ongoing offer of the scheme.
As per the company’s note, lumpsum fresh or additional purchases, switch-ins, Systematic Investment Plan, Systematic Transfer Plan and other facilities offered under the Scheme will be limited to Rs. 1 lakh per day per PAN with effect from February 1, 2022 until further notice. The existing SIP and STP mandates received on or before January 31, 2022 will continue to be processed, irrespective of the amount.
In the official note, the company says, “Thanks to its unique investment strategy and strong performance since its launch, Edelweiss Recently Listed IPO Fund has quickly grown and has reached a size where we think it is prudent to limit inflows. The limit will allow us to review the liquidity profile of the portfolio and pipeline of upcoming opportunities.”
Launched in Feb 2018, Edelweiss Recently Listed IPO Fund invests in recently listed companies or companies foraying to enter the capital markets via Initial Public Offering.
After applying for IPOs, there is no assurance that the investor will get the allotment especially when IPO issues get oversubscribed several times over. As an investor, if you still want to take an exposure to the recently-listed IPOs, Edelweiss Recently Listed IPO Fund may be explored by an investor.
The scheme was launched as a closed ended fund (earlier known as Edelweiss Maiden Opportunities Fund – Series 1) and was converted into an open ended fund for new investors to enter and participate in the IPO market which saw new age businesses list and grow.
The fund provides 3 key benefits to investors:
- Access to recently listed and upcoming IPOs
- Right selection of businesses within this universe
- Capturing post listing gains from IPOs
The fund has been very selective while investing in IPOs and has averted some overpriced and bad businesses that got listed in recent times. This has helped the fund in generating strong 20.93% CAGR returns since its inception.