NEW DELHI: HSBC Asset Management (India) Private Limited (HSBC AMC) launch an open-ended equity scheme that will predominantly invest in mid-cap stocks.
The HSBC Mid-Cap Fund will look to seek long-term capital growth from an actively managed portfolio of equity and equity-related securities of predominantly mid-cap companies.
The fund, which will open on 6 September and close on 20 September, will follow the Nifty Mid Cap 150 index total return index benchmark, and will be managed by Ankur Arora.
Talking about the fund’s investment strategy, Ankur Arora, senior vice president and fund manager, HSBC AMC, said, “HSBC Mid Cap Fund aims to build a concentrated portfolio through the bottom-up implementation of stock ideas and top-down approach for prudent risk control. The fund will explore opportunities in the innovative disruptive theme and is expected to benefit from the construction of a fresh portfolio which is at the beginning of the expansion cycle.”
The scheme will have the flexibility to invest across large-, mid- and small-cap companies, but will be invested at least 65% in mid-cap companies.
The fund will explore opportunities in the expansionary theme that support mid- and small-cap companies to generate alpha.
According to the fund house, the scheme will follow the ‘4Q’ investment approach while identifying opportunities: quality of business; quality of management; quality of earnings; and quantum of earnings.
Commenting on the launch of the fund, Ravi Menon, chief executive officer, HSBC AMC, said, “We do believe that mid-caps offer a more diversified universe for investment and with the current emerging themes it also offers quality investment opportunities. With a quality portfolio, we are confident that HSBC Mid-Cap Fund will be a healthy addition to the customer’s portfolio for long term compounding.”
There will be an exit load of 1% on redemption or switch-out of units within one year of allotment, and nil, thereafter.
There are more than 20 active funds in the mid-cap category available in India. HDFC Mid-Cap Opportunities is the biggest fund in the category, with net assets of more than ₹30,000 crore, followed by Kotak Emerging Equity with net assets of about ₹15,000 crore.
Over the past one year, most equity funds have delivered decent returns driven by a sharp jump in markets.
The mid-cap category has delivered an average return of around 66% for the one year period. However, experts warn that investors shouldn’t have similar expectations going ahead.
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