The investment objective of the scheme is to achieve long-term capital growth and generate income from a portfolio, predominantly of equity and equity-related securities.
Union AMC, co-sponsored by Union Bank of India and Dai-ichi Life Holdings, Inc. of Japan, has announced the launch of Union Hybrid Equity Fund, an open-ended hybrid scheme investing predominantly in equity and equity-related instruments. The investment objective of the scheme is to achieve long-term capital growth and generate income from a portfolio, predominantly of equity and equity-related securities. The scheme will also invest in debt & money market instruments.
The scheme will invest a minimum of 65% in equity and a maximum of 35% in debt. The New Fund Offer (NFO) of the Scheme opens on 27th November 2020 and closes on 11th December 2020. The allotment would be on 18th December 2020 and it will re-open for continuous sale and repurchase on 28th December 2020.
The Scheme is benchmarked against CRISIL Hybrid 35+65 Aggressive Index (TRI) and will be managed by Vinay Paharia, Parijat Agrawal and Hardick Bora. The minimum investment required is Rs 5,000 and in multiples of Re 1 thereafter.
G. Pradeepkumar, Chief Executive Officer (CEO), Union Asset Management Company Private Limited, said “Among other things, prudent asset allocation forms the bedrock of a successful investment outcome. Different asset classes do not generally move in tandem and hence taking exposure to Union Hybrid Equity Fund which inherently offers a combination of equity and debt can be a good choice for investors looking for a balanced approach to asset allocation. This scheme shall endeavour to maintain a judicious mix of equity and debt within the overall limits allowed for this category. All investment decisions in this scheme portfolio will be guided by our strong investment process”
Similar to other mutual fund schemes, the Union Hybrid Equity Fund has the following options for the investors:
Growth Option: This option is suitable for investors who are not seeking dividend but who invest only with the intention of capital appreciation.
Dividend Option: This option is suitable for investors seeking income through dividend declared by the Scheme. Under this option, the scheme will endeavour to declare dividends from time to time. The dividend shall be dependent on the availability of distributable surplus. The dividend option has the following facilities
- Dividend Re-investment Facility
- Dividend Pay-out Facility
- Dividend Sweep Facility
There are several types of hybrid schemes with varying allocation in equities and debt assets. Hybrid equity schemes with aggressive allocation suit those who wish to take exposure to both equity and debt assets and yet enjoy the tax benefit of equity schemes.