SBI Income Plus Arbitrage Active FOF - Direct (G): NFO Details

The SBI Income Plus Arbitrage Active FOF - Direct (G) is an open-ended fund of fund scheme designed for investors seeking regular income and long-term capital appreciation. This fund invests in a mix of actively managed debt-oriented mutual funds and actively managed arbitrage mutual funds, providing a balanced exposure to both fixed income and equity arbitrage opportunities. The scheme follows a diversified approach while actively managing interest rate and credit risk.

Details of the NFO: SBI Income Plus Arbitrage Active FOF - Direct (G)

Investment Objective and Strategy:

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Objective:

The investment objective of the scheme is to generate regular income and capital appreciation by investing primarily in units of actively managed debt-oriented mutual fund schemes and arbitrage mutual fund schemes. However, there is no guarantee that the investment objective will be fully achieved.

Investment Strategy:

This is a fund of fund scheme, which means it invests in other mutual fund schemes rather than directly in stocks or bonds. The strategy involves:

• Allocating funds to actively managed debt schemes based on factors like interest rates, policy changes, market liquidity, and credit risk.
• Investing in arbitrage mutual fund schemes that capitalize on price differences between the cash and derivatives market.
• Actively managing asset allocation to adapt to market conditions and maximize income potential.
   

Strengths and Risks – SBI Income Plus Arbitrage Active FOF - Direct (G)

Strengths:

• Balanced Exposure: Combines debt and arbitrage strategies to provide stability and potential upside.
• Actively Managed: Uses expert analysis and forecasting to navigate interest rate movements and credit trends.
• Diversified Portfolio: Reduces risk by investing in a mix of mutual fund schemes rather than individual securities.
• Suitable for Conservative Investors: This type of fund is generally ideal for those who prefer regular income with lower equity market exposure.
   

Risks:

• Liquidity Risk: Redemptions or large withdrawals could delay access to funds, especially during stressed market conditions.
• Volatility Risk: Market movements driven by external factors may cause fluctuations in the fund’s returns.
• Default Risk: If the underlying debt funds invest in instruments where issuers fail to meet their obligations, returns may be impacted.
• Other Risks Related to Debt and Money Market Securities: Includes interest rate risk, credit risk, reinvestment risk, and market liquidity issues that may impact returns.
   

Why Invest in SBI Income Plus Arbitrage Active FOF - Direct (G)?

This fund is well-suited for investors looking for a conservative yet actively managed investment option that offers exposure to both fixed income and arbitrage opportunities. It combines the stability of debt mutual funds with the relatively lower risk equity exposure offered by arbitrage funds.

• Designed for Regular Income: Ideal for those looking to generate consistent income while preserving capital.
• Professionally Managed: Experts select and rebalance investments based on changing market dynamics.
• Low Entry Barrier: You can start investing with ₹5,000 in this scheme.
• Well-Defined Exit Load Structure: Offers flexibility to investors depending on their investment horizon.
   

Disclaimer: This article is for educational purposes only and does not constitute investment advice. Please consult a financial advisor before making any investment decisions.