Give your Cash the Arbitrage Edge

Equity

Principal Arbitrage Fund

(An Open-ended Equity Scheme)

This product is suitable for investors who are seeking* :

  • Income over short-term
  • Income through arbitrage opportunities between cash and derivative market and arbitrage opportunities within the derivative segment.

*Investors should consult their financial advisors if in doubt about whether the product is suitable for them.

The investment objective of the scheme is to generate capital appreciation and income by predominantly investing in arbitrage opportunities in the cash and derivative segments of the equity markets and the arbitrage opportunities available within the derivative segment and by investing the balance in debt and money market instruments. There is no assurance or guarantee that the investment objective of the scheme will be realized.

Fund Manager:
Mr. Rajat Jain
Allotment Date:
April 21, 2016
Benchmark: Crisil Liquid Fund Index

The indicative asset allocation will be as under:

InstrumentsMinimum
(%)
Maximum
(%)
Risk Profile
Equity and equity related instruments 65 90 Medium to High
Equity derivatives 65 90 Medium to High
Debt securities and Money Market Instruments# (including Margin for Derivatives) and Fixed Income Derivatives 10 35 Low

# The Scheme may invest in Treasury Bills, Repos, Reverse Repos & Collateralized Borrowing and Lending Obligations (“CBLO”) and units of Debt/Liquid and Money Market Mutual Fund Schemes

When adequate arbitrage opportunities are not available in the Derivative and Equity markets, the anticipated alternate asset allocation on defensive considerations would be in accordance with the allocation given below. However, in case no arbitrage opportunity is available, then 100% of the remaining investible corpus (excluding margin for derivatives and to the extent not deployed in arbitrage opportunities in the asset allocation pattern mentioned above) will be deployed in short term debt and money market instruments with tenure not exceeding 91 days (including investments in securitized debt). In this scenario also, the allocation in Equities and equity related instruments, Derivatives including index futures, stock futures will continue to be made in arbitrage opportunities only.

InstrumentsMinimum
(%)
Maximum
(%)
Risk Profile
Equity and equity related instruments including Derivatives 0 65 Medium to High
Debt securities and Money Market Instruments# (including Margin for Derivatives) and Fixed Income Derivatives 10 35 Medium to High
Short term Debt and Money market instruments not exceeding tenure of 91 days (including investments in securitized debt) 0 100 Low

# The Scheme may invest in Treasury Bills, Repos, Reverse Repos & Collateralized Borrowing and Lending Obligations (“CBLO”) and units of Debt/Liquid and Money Market Mutual Fund Schemes.


Investment in Securitized Debt may be up to 30% of the net assets of the Scheme. Subject to the SEBI Regulations, the Mutual Fund may deploy upto 50% of its total net assets of the Scheme in Stock Lending

The Scheme will offer two Plans i.e. Regular Plan & Direct Plan. Each of the Plans mentioned above offers Growth and Dividend Option. The Dividend Option under both the Plans will have the facility of Payout, Reinvestment and Sweep.

Exit Load: If redeemed on or before 30 days from the date of allotment - 0.50%. If redeemed after 30 days from the date of allotment - NIL.

For New Investor, Minimum application amount will be 5,000/- and in multiples of Re. 1 thereafter

3.00 p.m.

In respect of purchase/switch-in of units for an amount equal to or more than 2 lakhs, the closing NAV of the day shall be applicable subject to realization of the funds upto 3.00 pm and receipt of application (duly time stamped)

Regular Plan
1.05% p.a. of the daily net assets

Direct Plan
0.35% p.a. of the daily net assets

GST on Management Fees and proportionate charge in respect of sales beyond T-15 cities subject to maximum of 30 bps on daily net assets are charged in addition to the above stated Expense Ratios.

SIP / RWP / STP: Available

Minimum Number & Amount of SIP/RWP/STP:

SIP : 6 installments of 2000/- each.

STP : 6 installments of 1000/- each.

RWP: 6 installments of 500/- each.