Upcoming NFO: Invesco Mutual Fund Filed Draft for Equity Long-Short Fund Under Summit SIF

Summit SIF has filed a draft Investment Strategy Information Document for the Summit Equity Long-Short Fund. The fund will be offered by Invesco Mutual Fund and structured as an open-ended equity investment strategy. It will invest in listed equity and equity-related instruments, with limited short exposure through derivatives. 

The filing notes that the fund falls under the Equity Long-Short category. It has been assigned Risk Band Level 5 under AMFI guidelines. The fund is a new offering and does not have a performance history. 

Asset Allocation and Limits 

According to the draft, 80-100% of the fund’s net assets will be invested in equity and equity-related instruments. Short exposure through unhedged equity derivatives will be permitted up to 25% of net assets. Allocation to debt and money market instruments may go up to 20%. 

The fund may invest up to 20% of its net assets in InvITs. Overseas securities exposure is permitted up to 35%, subject to regulatory limits. During the 6 months following the closure of the New Fund Offer (NFO), the fund proposes to invest up to $15 million in overseas securities. 

Investment Method and Controls 

The long portfolio will be selected using a bottom-up approach based on company-level factors such as earnings, valuation metrics, and capital efficiency. Short positions will be implemented using equity derivatives, including stock futures, index futures, and options. 

The filing states that unhedged derivative exposure will be capped at 25%. Portfolio exposure, sector concentration, liquidity, and drawdowns will be monitored on a daily basis in line with regulatory requirements. 

Subscription and Redemption Terms 

Units will be available for purchase and redemption on all business days at applicable NAV. The minimum investment amount during the NFO and on a continuous basis is ₹10 lakh. Additional investments can be made from ₹1,000 onwards. 

An exit load of 0.50% will apply if units are redeemed within three months from the date of allotment. No exit load will be charged for redemptions after three months. The benchmark index for the strategy is the Nifty 100 Total Return Index. 

Read More: Union Mutual Fund Enters into SIF Segment with the Launch of Arthaya SIF Platform! 

Conclusion 

The draft outlines the investment structure, exposure limits, and operating terms for Summit SIF’s first investment strategy, which combines long equity positions with limited short exposure through derivatives. 

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.