Upcoming NFO: Edelweiss Mutual Fund Files Draft for Financial Services Fund With SEBI

Edelweiss Mutual Fund has submitted the draft documents for its new sector-focused scheme, the Edelweiss Financial Services Fund, to SEBI. This is planned as an open-ended equity fund that will invest mainly in companies linked to the financial services space. Units will be offered at ₹10 during the NFO. The exact opening and closing dates are yet to be announced, and the NFO can run for up to 15 days once approved. 

What the Scheme Plans to Invest In? 

As per the draft, the fund intends to keep 80–100% of its assets in equity and equity-related instruments from the financial services sector. Up to 20% may be placed in other equity holdings. The scheme may also invest as much as 20% in debt and money-market instruments.  

Exposure to REITs and InvITs will be capped at 10%. The proposal also includes overseas exposure, with limits of $5 million each for foreign securities and overseas ETFs during the initial period. 

Benchmark and Risk Label 

The scheme will use the NIFTY Financial Services TRI as its benchmark. This index covers banks, NBFCs, insurance companies, housing finance firms and other similar entities.  

Both the scheme and the benchmark fall under the Very High risk category, as stated in the draft. There is no performance record, since the fund has not yet been launched. 

Sectors and Companies Covered 

The investment scope mentioned includes banks, fintech companies, brokers, microfinance institutions, payment systems, depositories, wealth management firms, insurance players and other supporting entities in the financial ecosystem.  

The scheme does not follow a fixed market-cap approach and may take larger positions in specific stocks where needed. The draft also notes the use of derivatives for hedging and basic portfolio management. 

Operational Rules 

The fund will offer Regular and Direct Plans, with Growth and IDCW options. Minimum investment begins at ₹100 for lump sums, SIPs, STPs and SWPs. Redemption payments are expected within three working days.  

An exit load of 1% applies if units are redeemed within 90 days, and no load applies after that. NAVs will be published daily on the AMC and AMFI websites. 

Read More: Union Mutual Fund Filed Draft for Consumption Fund with SEBI! 

Conclusion 

The draft sets out the structure and basic terms for the proposed sector-focused scheme. Final details will be available once SEBI completes its review. The opening and closing dates are yet to be announced, and the NFO can run for up to 15 days once approved. 

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.