Bandhan Mutual Fund files draft document with SEBI for AI-Based Quant Fund
Bandhan Mutual Fund has submitted a draft document to SEBI for its new Bandhan Quant Fund. This fund will be an open-ended equity scheme that uses artificial intelligence (AI) and machine learning (ML) to decide its investments. It will follow a smart and evolving model to select stocks.
The fund aims to help investors grow their money over the long term by investing mainly in shares and related instruments chosen using this advanced technology.
The primary aim of the scheme is to create medium to long-term capital appreciation. This will be through investment primarily in equity and equity-related instruments selected by means of an AI/ML-driven quantitative model. The fund will follow BSE 200 TRI as its benchmark index. The management team for the scheme has dedicated experts for different segments such as equity investments, debt instruments and overseas investments.
Key Features and Investment Allocation
This fund has an exit load of 0.50% on redemption or switching within 30 days from the allotment date; no exit load is applicable thereafter. The minimum investment is Rs.1,000 for lump sum, and Rs.100 for SIPs, with a minimum of six installments. For Systematic Transfer Plans (STPs), the minimum investment starts at Rs.500.
Asset Allocation Plan in the Scheme
- 80-100% in equity and equity-related instruments selected on the basis of the quantitative model theme.
- 0-20% in equity-related overseas securities.
- 0-20% in debt securities and money market instruments, including government securities and securitized debt.
- 0-10% in units issued by REITs and InvITs.
Unique Investment Strategy
The fund uses a data-driven approach that combines traditional factors such as earning quality, value, and momentum with alternative factor premiums, such as analyst revisions and estimates. The model combines AI/ML techniques with fund manager insights to create a diversified and balanced portfolio. The focus is on large and mid-cap companies to maximize returns while maintaining effective risk management.
The Bandhan Quant Fund is suitable for long-term wealth creation through equity investments. The AI/ML-driven adaptive model of the fund will be an innovative offering for the thematic, data-driven approach of investment seekers.
