An actively managed open-ended short term debt fund.​

Mirae Asset Short Term Fund

Investment Objective of Mirae Asset Short Term Fund*

The investment objective of the scheme is to seek to generate returns through an actively managed diversified portfolio of debt and money market instruments with Macaulay duration of the portfolio between 1 year to 3 years.

However, there is no assurance that the investment objective of the Scheme will be realized and the Scheme does not assure or guarantee any returns.

*Source: Scheme Information Document

(Learn how to read the Scheme Information Document here.)

Is Mirae Asset Short Term Fund for you?

Mirae Asset Short Term Fund (MASTF) is an open-ended short term debt fund with an investment objective to generate returns through an actively managed diversified portfolio of debt and money market instruments with Macaulay duration of the portfolio between 1 year to 3 years.

Being short term debt fund it will invest upto 100% of its net assets into money market and debt instruments.

Conservative investors at present are in a dilemma. On one hand, banks have been slashing interest rates on deposits, while on the other, the RBI is forecasting a rise in inflation in the foreseeable future. However, rising inflation is another cause concern for many.

Given the market-linked nature of debt mutual funds, the return potential hinges on market conditions and how efficiently the fund manager manages the portfolio.

Investing in debt funds exposes you to various risks: interest rate risk and credit risk being the primary ones.

Hence, MASTF is suitable for investors with low to medium risk appetite aiming to park their money for short term.  This fund is best suited for investors who can assume high risk in an anticipation of high returns in future. But keep your interest rate risk and credit risk in in mind before investing into a short term debt fund.

The asset allocation of Mirae Asset Short Term Fund under normal circumstances will be as under:

 
* Includes investment in derivatives up to 50% of the net assets of the Scheme.
^ The Scheme may invest in securitized debt upto 20% of its net assets

Further it is stated in the offer document that:

• Investment in Securitized debt (excluding foreign securitized debt), if undertaken, would not exceed 20% of the net assets of the Scheme
• The Scheme may invest in repo/reverse repo in corporate bonds

(*Source: Scheme Information Document)

---

Investment Strategy Of Mirae Asset Short Term Fund

Being an open-ended debt fund, it will predominantly invest into money market and debt securities. It is also mandated to invest upto 100% of its net assets into REITs and InvITs.

The scheme may invest in securities issued by corporates (both private and public sectors) including banks and financial institutions. Further it may also invest in money market instruments across maturities, yield curve and ratings.

To have an overall view on interest rates and sector allocation it will follow top to bottom approach in security selection. And to asses the quality of the security and liquidity, bottom up approach will be followed by the scheme.

It aims to optimise risk adjusted returns. And for that the scheme aims to make investments in debt and money market instruments with Macaulay duration of the portfolio between 1 year to 3 years.

The Macaulay Duration is the weighted average term to maturity of the cash flows from a bond. The weight of each cash flow is determined by dividing the present value of the cash flow by the price.

As investments in debt instruments carry various risks such as interest rate risk, reinvestment risk, credit risk, liquidity risk and so on. The scheme aims to reduce this risk through diversification.

---

Fund Manager for Mirae Asset Short Term Fund

Mirae Asset Short Term Fund will be managed by Mr Mahendra Kumar Jajoo

Mr Mahendra Kumak Jajoo is the Head – Fixed Income of Mirae Asset Global Investments (India) Pvt. Ltd. He is a ACA, ACs and CFA with over 25 years of experience in the field of financial services. Currently he is responsible for supervising all the debt schemes of Mirae Asset Mutual Fund. Prior to this he was associated with organizations like Pramerica Asset Managers Ltd., Tata Asset Management Ltd., ABN AMRO Asset Management Ltd and ICICI Group.

Other Schemes managed by Mr Jajoo are Mirae Asset Savings Fund, Mirae Asset Cash Management Fund, Mirae Asset Dynamic Bond Fund, Mirae Asset Prudence Fund (Debt portion) and Mirae Asset Tax Saver Fund (Debt portion).

---

Fund Outlook

On evaluating the fund’s objective and investment strategy, MASTF will have upto 100% exposure to money market and debt related instruments. The investment strategy of the scheme is to actively manage the portfolio and aim to optimise risk adjusted returns.

Currently, short-term maturity papers are turning attractive and fund houses, too, are aligning their portfolio accordingly. An investment horizon of over three years will give you an additional tax advantage.

As you might be aware, debt funds invest in bonds and fixed income securities issued by banks, corporate, and the Government, including those issued by the state governments. When the interest rates move up, bond prices move down and vice-a-versa. Similarly, debt funds run a risk of losing money if the debtor fails to discharge its debt obligations.

Therefore, you should consider your risk appetite while choosing a debt fund.

Tax implication is another important aspect to consider while investing in debt mutual funds. Your gains from long term investment in debt mutual funds (i.e. held over a period of 3 years), are taxable @ 20% with an indexation benefit available. While the short-term capital gains from debt and liquid mutual funds are taxable as per your tax slab.

Going forward, according to RBI, the inflation outlook will be influenced by several factors. Therefore, there is a need for vigilance around the evolving inflation scenario in the coming months. During such times, first selecting the category of debt mutual funds becomes crucial.

With this dominant portion of the fund’s asset being invested in money market securities, the fortune of the fund will be linked to the interest rate movement in the short run.

PersonalFN believes, when you invest in debt funds, you should be careful about the safety measures undertaken by the fund. Unfortunately, most investors overlook the risk.

(Infographic: 5 Reasons Why You Should Avoid NFOs)

---

DISCLOSURE AS PER SECURITIES AND EXCHANGE BOARD OF INDIA (RESEARCH ANALYSTS) REGULATIONS, 2014  

About the Company including business activity

Quantum Information Services Private Limited (QIS) was incorporated on December 19, 1989.

QIS was promoted by Mr. Ajit Dayal with an objective of providing value-based information / views on news related to equity markets, the economy in general, sector analysis, budget review and various personal products and investments options available to the Public. It was the first company to start equity research on an institutional level.

‘PersonalFN' is a service brand of QIS and was started in the year 1999. In 1999, the Company registered the Domain name www.personalfn.com for providing information on mutual funds and personal financial planning, financial markets in general, etc and services related to financial planning and research in various financial instruments including mutual funds, insurance and fixed income products to customers. It offers asset allocation and researched investment recommendations through its financial planning services.

Quantum Information Services Private Limited (QIS) is registered as Investment Adviser under SEBI (Investment Adviser) Regulations, 2013 and having Registration No.: INA000000680. In terms of second proviso to Regulation 3 (1) of SEBI (Research Analysts) Regulations, 2014 the Company is not required to obtain Certificate of registration from SEBI.

Disciplinary history

There are no outstanding litigations against the Company, it subsidiaries and its Directors.

Terms and condition on which its offer research report
For the terms and condition for research report click here.

Details of associates

1. Money Simplified Services Limited;
2. PersonalFN Insurance Services India Limited ;
3. Equitymaster Agora Research Private Limited;
4. Common Sense Living Private Limited;
5. Quantum Advisors Private Limited;
6. Quantum Asset Management Company Private Limited;
7. HelpYourNGO Private Limited;
8. HelpYourNGO Foundation;
9. Natural Streets for Performing Arts Foundation;
10. Primary Real Estate Advisors Private Limited;
11. Rahul Goel;
12. I V Subramaniam.

Disclosure with regard to ownership and material conflicts of interest
 

1. Neither QIS, it's Associates, Research Analyst or his/her relative have any financial interest in the subject Company, except QIS receives fees for providing research to Quantum Equity Fund of Fund (QEFoF) which is Fund of Fund scheme managed by QMF and our associates has financial interest in the subject company.
2. Neither QIS, it's Associates, Research Analyst or his/her relative have actual/beneficial ownership of one per cent or more securities of the subject Company, at the end of the month immediately preceding the date of publication of the research report.
3. Neither QIS, it's Associates, Research Analyst or his/her relative has any other material conflict of interest at the time of publication of the research report except that QIS is, as per SEBI (Mutual Funds) Regulations 1996, an associate / group Company of Quantum Asset Management Company Private Limited and Trustees and Sponsor of Quantum Mutual Fund (QMF) and to that extent there may be conflict of interest while recommending any schemes of QMF. However any such recommendation or reference made is based on the standard evaluation and selection process, which applies uniformly for all Mutual Fund Schemes. The payment of commission (upfront /annualized & trail), if any, for any Schemes by QMF to QIS is also at arm's length and as per prevailing market practices.
    

Disclosure with regard to receipt of Compensation

1. Neither QIS nor it's Associates have any compensation from the subject Company in the past twelve months.
2. Neither QIS nor it's Associates have managed or co-managed public offering of securities for the subject Company in the past twelve months.
3. Neither QIS nor it's Associates have received any compensation for investment banking or merchant banking or brokerage services from the subject Company in the past twelve months.
4. Neither QIS nor it's Associates have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months, except that QIS had receive fees for services under sponsorship agreement from Franklin Templeton Asset Management India Pvt. Ltd.
5. Neither QIS nor it's Associates have received any compensation or other benefits from the subject Company or third party in connection with the research report
    

General disclosure

1. The Research Analyst has not served as an officer, director or employee of the subject Company.
2. QIS or the Research Analyst has not been engaged in market making activity for the subject Company.
    

Subject Company means Mutual Fund Schemes

Quantum Information Services Pvt. Ltd. 103, Regent Chambers, 1st Floor, Nariman Point, Mumbai - 400 021. Tel: +91 22 6136 1200
Website : www.personalfn.com CIN: U65990MH1989PTC054667

 

© Quanutm Information Services Pvt. Ltd. All rights reserved.
Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of PersonalFN is strictly prohibited and shall be deemed to be copyright infringement.

Disclaimer: Quantum Information Services Pvt. Limited (PersonalFN) is not providing any investment advice through this service and, does not constitute or is not intended to constitute an offer to buy or sell, or a solicitation to an offer to buy or sell financial products, units or securities. All content and information is provided on an 'As Is' basis by PersonalFN. Information herein is believed to be reliable but PersonalFN does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. PersonalFN and its subsidiaries / affiliates / sponsors or employees, personnel, directors will not be responsible for any direct / indirect loss or liability incurred by the user as a consequence of him or any other person on his behalf taking any investment decisions based on the contents and information provided herein. This is not a specific advisory service to meet the requirements of a specific client. Use of this information is at the user's own risk. The user must make his own investment decisions based on his specific investment objective and financial position and using such independent advisors as he believes necessary. All intellectual property rights emerging from this newsletter are and shall remain with PersonalFN. This is for your personal use and you shall not resell, copy, or redistribute this newsletter or any part of it, or use it for any commercial purpose. The performance data quoted represents past performance and does not guarantee future results. As a condition to accessing PersonalFN's content and website, you agree to our Terms and Conditions of Use, available here.

Quantum Information Services Pvt. Ltd. Regd. Office: 103, Regent Chambers, 1st Floor, Nariman Point, Mumbai - 400 021 Corp. Office: 103, Regent Chambers, 1st Floor, Nariman Point, Mumbai - 400 021. Email: info@personalfn.com CIN: U65990MH1989PTC054667

SEBI-registered Investment Adviser. Registration No. INA000000680, SEBI (Investment Advisers) Regulation, 2013

Add Comments