Invesco Mutual Fund, an asset management company, on Thursday announced the launch of two target maturity debt index funds – Invesco India Nifty G-sec Jul 2027 Index Fund and and Invesco India Nifty G-sec Sep 2032 Index Fund. While the former is an open-ended target maturity index fund tracking Nifty G-sec Jul 2027 index and is available till March 17, later is a relatively high interest rate risk and relatively low credit risk. The Invesco India Nifty G-sec Sep 2032 Index Fund is available till March 24, 2023.
The new fund offers (NFOs) will invest 95-100 percent of its net assets in government securities. The objective of these open-ended, passively managed target maturity debt index funds is to mirror the underlying benchmark index and mature on a pre-determined date, the fund house said in a statement.
Invesco India Nifty G-sec Jul 2027 Index Fund will mature on July 30, 2027 and Invesco India Nifty G-sec Sep 2032 Index Fund will have maturity on September 30, 2032.
Speaking at the launch, Taher Badshah, Chief Investment Officer, Invesco Mutual Fund said, “With central banks steering towards the end of rate hike cycle, Indian fixed income market has come to an inflection point with risk-reward turning favourable for investors. The sharp increase in interest rates over the past one year now warrants for increased allocation towards fixed income as an asset class that has the potential of generating meaningful income. These funds have been carefully designed to capitalise on the prevailing high interest rates in the market and are particularly suited to investors with a specific financial goal that aligns with the fund’s maturity timeline and superior asset quality.”
“At Invesco Mutual Fund, we are always looking for innovative ways to meet the evolving needs of our clients, and these new funds are testament to that commitment.”
Vikas Garg, Head of Fixed Income, Invesco Mutual Fund said “The market is offering attractive carry opportunities, as interest rates are approaching their peak and future rate actions expected to be more calibrated and data dependent. Global factors could influence domestic policy actions, which could lead to some market volatility in short term. By remaining invested for the entire tenure of target maturity funds, investors can potentially realise the benefits of attractive carry opportunities without getting impacted by interest rate volatility and achieve their financial objectives."
Krishna Cheemalapati and Vikas Garg are the dedicated fund managers for both the index funds.
The minimum initial investment in the funds will be Rs.1,000 and multiples of Re 1 thereafter.
