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EQUITY SAVINGS FUNDS Ideal for investors seeking FD-plus returns, low volatility
Business Standard
|March 07, 2025
Market volatility has made equity allocation difficult, especially for conservative investors. Equity Savings Funds (ESFs) offer a solution.
Market volatility has made equity allocation difficult, especially for conservative investors. Equity Savings Funds (ESFs) offer a solution. A recent new fund offer (NFO) of an ESF from WhiteOak Capital Asset Management Company (AMC) highlights their growing appeal.
"ESFs offer a blend of equity, debt, and arbitrage with lower volatility than pure equity funds, which is appealing amid recent market swings. They also deliver tax-efficient returns," says Harshad Borawake, head of research and fund manager, Mirae Asset Investment Managers (India). As of January 31, 2025, ESFs managed assets worth ₹42,161 crore (Association of Mutual Funds in India data).
How ESFs work
ESFs allocate up to 65 per cent of assets across stocks and arbitrage. Typically, 15-35 per cent is invested in stocks, and the rest in spot-future arbitrage and bonds. Though fund managers have flexibility in stock and bond selection, portfolios usually comprise largecap stocks and high-quality bonds, besides government securities.
This story is from the March 07, 2025 edition of Business Standard.
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