Old Bridge Mutual Fund Files Draft for Arbitrage Fund with SEBI

Old Bridge Mutual Fund has filed a draft offer document with SEBI to launch the Old Bridge Arbitrage Fund. The scheme will operate as an open-ended fund that invests in arbitrage opportunities available in equity and derivatives markets. 

The fund aims to generate income over the short term by taking advantage of pricing differences between cash and futures segments.

Fund Objective and Benchmark

The investment objective of the scheme is to generate income through arbitrage opportunities between the equity spot and derivatives markets, and to invest the remaining portion in debt and money market instruments. However, the fund does not assure or guarantee returns.

The benchmark for the scheme will be the Nifty 50 Arbitrage Total Return Index (TRI), which is classified as the AMFI Tier I Benchmark for arbitrage funds.

Plans and Options

The scheme will be offered under two plans: Regular Plan and Direct Plan, both maintaining a common portfolio but separate Net Asset Values (NAVs). Investors can choose between a Growth Option and an Income Distribution cum Capital Withdrawal (IDCW) Option.

Investment and Redemption Details

During the New Fund Offer (NFO), units will be issued at ₹10 each. The minimum investment amount during the NFO and on a continuous basis is ₹5,000, with additional purchases allowed in multiples of ₹1. For Systematic Investment Plans (SIPs), the minimum amount is ₹2,500 with a minimum of six instalments. 

The minimum redemption or switch-out amount is ₹1,000 or the account balance, whichever is lower.

Exit Load and Timelines

An exit load of 0.25% will apply if the units are redeemed or switched out within seven days of allotment. There will be no exit load after this period. Redemption proceeds will be dispatched within three business days, and IDCW payments will be made within seven business days from the record date, in line with SEBI and AMFI guidelines.

Read More:ITI Mutual Fund Filed Draft With SEBI for Diviniti Equity Long Short Fund!

Conclusion

The draft proposal is currently under SEBI review. Once approved, the fund will open for subscription during the New Fund Offer period before transitioning into continuous sale and repurchase at NAV-based prices.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund Investments are subject to market risks, read all the related documents carefully before investing.