Bandhan Mutual Fund Files Draft For Fixed Maturity Plan (FMP) Series 209-211

Bandhan Mutual Fund, previously known as IDFC Mutual Fund, has filed a draft proposal for its Fixed Maturity Plan (FMP) Series 209-211. These are close-ended debt schemes designed to deliver fixed income over specified timeframes. Let’s dive into the details.

Scheme Overview

The Bandhan FMP Series 209-211 targets investments in debt and money market instruments. The fund’s objective is to generate income within the portfolio’s tenure, ranging between 1 month and 192 months. As a close-ended scheme, it will only accept investments during the New Fund Offer (NFO) period and will subsequently be listed on the BSE for investor liquidity.

Investment Strategy

The schemes align investments with the portfolio’s maturity date, focusing on various risk and duration profiles. They are categorized under different Potential Risk Classes (PRC):

• Macaulay Duration <12 months: Low-interest and credit risk (A-I).
• Macaulay Duration 12-36 months: Moderate-interest, low-credit risk (A-II).
• Macaulay Duration >36 months: High-interest, low-credit risk (A-III).

Portfolio Composition

Depending on the series duration, the fund allocates:

• 1-13 months: Up to 100% in debt and money market instruments.
• 13-36 months: 70%-100% in debt securities, with up to 30% in money market instruments.
• 36-192 months: 80%-100% in debt securities and up to 20% in money market instruments.

The fund excludes certain high-risk securities such as derivatives, foreign instruments, and structured obligations.

Risk & Benchmark Details

The risk classification and benchmarks will depend on the tenure of the specific series. Indicative benchmarks include:

• Shorter tenures: CRISIL Liquid Debt A-I Index or NIFTY Ultra Short Duration Debt Index.
• Medium tenures: NIFTY Short Duration Debt Index.
• Longer tenures: NIFTY Medium Duration Debt Index.

Operational Details

• NFO Pricing: Rs. 10 per unit.
• Minimum Investment: Rs. 5,000 with increments of Re. 1.
• NAV Disclosure: Published on AMFI and Bandhan MF websites within five business days post-allotment.

All in all, Bandhan MF’s Fixed Maturity Plan Series 209-211 provides an investment option tailored for those seeking fixed income aligned with defined timelines. The scheme balances risk across tenures, offering diversification within the debt market. Potential investors should review their financial goals and consult advisors to determine suitability.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.