HSBC has hopped onto the dividend yield train. HSBC Unique Opportunities fund will be modified to reflect such a strategy and be renamed HSBC Dividend Yield Equity Fund. The scheme used to follow a mandate of investing in stocks facing ‘out of normal’ conditions, such as those undervalued or temporarily affected by one-off events and likely to pick up later. Now, the scheme will try to generate returns through focusing on stocks with good dividend yields; 65 to 100 per cent of the portfolio will go into such stocks, while up to 35 per cent could go into other equities.
The change is effective from July 17. Existing investors who don’t want to invest in the fund’s new avatar must exit the scheme by July 17. The other fund to make some modification is Principal Growth Fund, which has cut its exit load to 1 per cent for redemptions within 365 days from the earlier 2 per cent.
Mid-caps have caught everyone’s eye. Union KBC’s first mid- and small-cap fund is set to close its offer period on June 3. An open-ended scheme, it will reopen from June 17 onwards. At least 65 per cent of the portfolio will be invested in stocks whose market capitalisation is less than that of the stocks constituting the BSE Top 100 Index. Some large-caps may also be included from time to time, since the portfolio must have at least 80 per cent invested in equities. The scheme’s benchmark is the BSE Midcap index. Ashish Ranawade will be the fund manager.
He also manages Union KBC Equity, which is a large-cap-oriented fund. The fund has a short track record, but has beaten its benchmark in the one-year period and has done slightly better than the category average.
Debt fund launches
If it is debt and safety that you’re gunning for, there are several debt fund launches to pick from. Closed-ended capital protection plans from the Birla Sun Life and ICICI Prudential stables will close on June 4 and 5. Axis MF’s Hybrid Fund - Series 13, a debt-oriented close-ended balanced fund will also close on June 10. The fund can invest between 5 and 30 per cent in equities. Two debt funds from SBI Mutual Fund have also opened. This apart, Fixed Maturity Plans are also coming in thick and fast and quite a few, such as DSP BlackRock, have extended their closing dates.