Edelweiss Mutual Fund Launches Low Duration Fund for Short-Term Investors
Edelweiss Asset Management Limited has announced the launch of the Edelweiss Low Duration Fund, an open-ended low-duration debt scheme. The New Fund Offer (NFO) period will be available from March 11 to March 18, 2025.
The purpose of the scheme is to earn income by investing mainly in money market securities and low-duration debt. The scheme will actively manage a high-quality portfolio with Macaulay duration between 6 and 12 months, seeking a balance between stability and yield.
Investors looking for short-term sources of income, the fund is suitable for moderate to low risk and focuses on money market securities and debt. The minimum investment is Rs.100, with additional investment in multiples of Rs. 1.
This fund aims to attract individual and institutional investors. Tax reforms introduced in recent times have rendered debt mutual funds more tax-efficient for retail investors. If aggregate income for a year, including capital gains on such funds, does not exceed Rs. 12 lakh, investors might not need to pay capital gains tax because of a rebate under the new tax regime.
Investor interest in low-duration schemes has risen sharply, with the segment experiencing net inflows of Rs.6,618 crore during the past half year. The Reserve Bank of India (RBI) is likely to increase banking system liquidity by lowering policy rates and paying a healthy dividend to the government, leading to more government expenditure from April 2025. RBI is also likely to buy bonds in FY26 using Open Market Operations, an action that will soothe short-term yields and facilitate a supportive atmosphere for low-duration strategies. The Edelweiss Low Duration Fund will be handled by Pranavi Kulkarni and Rahul Dedhia to ensure a systematically designed fund management.
