Bank of Baroda (BoB) Mutual Fund is planning to come out with a derivatives-linked product. Also in the offing are equity markets-related schemes including an index fund, a balanced fund and a growth fund.
The idea behind the move is to increase the assets managed by the asset management company (AMC) from Rs 40 crore to Rs 200 crore by the end of next year. Further, BoB AMC wants to change the market perception that it is not serious about mutual funds.
While the AMC has received permission from the Securities and Exchange Board of India for introducing balanced and growth funds, it would place the application for launching the index fund after the first two are launched.
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Managing director B Krishna Kumar said the firm is looking at equity-related products after giving emphasis on debt for some time now.
"Once the markets stabilise, indications of which are very strong, the company will come out with derivatives-related products as well. We are now working on what kind of products we will introduce, " he said.
The balanced and growth funds, he said, would be introduced in the quarter ended June which would be followed by a host of new products.
The proposed index fund would be benchmark the BSE Sensex, the popular barometer of the country's capital market.
Kumar came to Kolkata to participate in a road show in connection with the fund's three schemes-a income fund, a liquid fund and a gilt fund.
Investors can choose between a dividend and growth plan for any of these schemes being launched. Minimum application amount is Rs 2,000. The dividend income is totally exempt from Income Tax under Section 10(33) of Income Tax Act.