NFO Alert: SBI Mutual Fund launches Quant Fund — all you need to know

SBI Mutual Fund has introduced a new fund offer (NFO) on December 4 called SBI Quant Fund. It is an open-ended equity scheme following a Quant-based investing theme and will be benchmarked against the BSE 200 TRI.

The scheme will stay open for investors until December 18 and will reopen for continuous sale and repurchase within five business days following the allotment date.

What are quant funds?

For those who are unaware, quantitative funds, or quant funds, are mutual funds which deploy quantitative analysis and algorithms to make investing decisions. They aim to eliminate human bias and emotion from the investment process and therefore rely on data-driven models to generate returns.

Investment details

The minimum application amount in SBI Quant Fund is ₹5,000 and in multiples of Re 1 thereafter. For additional purchases, the minimum amount is ₹1,000 and in multiples of Re 1 thereafter. The minimum amount for redemption or switch-out is ₹500, or 1 unit, whichever is lower, or the entire account balance.
 

Investment objective

The investment objective of the scheme is to seek to generate long term capital appreciation by investing in equity and equity related instruments selected based on quant model themes.

Asset allocation

The scheme will allocate 80-100% of its assets in equity and equity-related instruments selected based on a quantitative model. It will allocate 0-20% in other equity and equity-related instruments, 0-20% in debt securities (including securitised debt and debt derivatives) and money market instruments (including tri-party repo), and 0-10% in units issued by REITs and InvITs.

Exit load

An exit load of 0.5% of the applicable Net Asset Value (NAV) will be charged if units purchased or switched in from another scheme of the fund house are redeemed or switched out on or before six months from the date of allotment. No exit load will be charged if these units are redeemed or switched out after six months from the allotment date.

The scheme will be managed by fund managers Sukanya Ghosh and Pradeep Kesavan. It is suitable for those investors who are seeking long-term capital appreciation and want to invest in equity and equity-related instruments selected using the Quant model.