Chola MF launches Global Advantage Fund

Chola Mutual Fund (MF) today launched its Global Advantage Fund which will invest in Indian companies that have or are expected to have at least 20 per cent export turnover over the next three years.

The company also plans to expand its product portfolio and set up more franchisees in north India and target smaller cities.

"We have filed the offer document for a dynamic index fund and a fixed maturity scheme with Sebi," Sashi Krishnan, chief executive, Chola Mutual Fund said.

The proposed dynamic index fund will be benchmarked against the NSE's Nifty while the fixed maturity fund will invest in government and corporate debt of short-term maturity.

Benchmarked against the S&P CNX 500, the Global Advantage Fund will invest 80 to 100 per cent of its assets in equity and the rest in debt and money market instruments.

"The fund will invest in 30 to 35 companies chosen from about 123 companies across sectors which as per our research meet the fund objective," Krishnan said.

The fund's IPO opened today and would close on May 16.

Canexpo Fund, which has a similar fund objective, has given 31.58 per cent returns in the last one year as against 21.75 per cent returns by the diversified mutual fund category, according to Valueresearchonline, which tracks mutual funds.

Chola's Advantage Fund launched today does not have an exit load but carries an entry load of 2.25 per cent up to an investment of Rs 1 crore. Higher investments do not attract an entry load.

The minimum application amount has been fixed at Rs 5,000.

"The stock selection process will particularly focus on five factors- global competitiveness, enduring business model, management quality, improving business fundamentals and attractive valuation," Tridib Pathak, chief investment officer, said.

Cholamandalam Investment & Finance Company's portfolio stood at Rs 1,024.49 crore as on March 31, 2005, out of which equity consist of about Rs 220 crore. Its tally of mutual fund schemes now stands at 12.