UTI's new fund to raise Rs 1000 cr

UTI Mutual Fund (MF) plans to raise over Rs 1,000 crore through its new scheme "UTI-Wealth Builder Fund" launched on September 7, will close on October 11, 2006. Units can be purchased only during the new fund offer period - from September 7, 2006 to October 11, 2006.

Rajesh Bhojani, president-sales, UTI Mutual Fund, said "We hope to raise little over 10 per cent of Rs 1,000 crore targeted under the scheme from Gujarat."

UTI-Wealth Builder Fund is a close-ended equity scheme with a maturity period of 5 years with automatic conversion into an open-ended scheme upon maturity of the scheme.

The objective of the scheme is to achieve long term capital appreciation by investing predominantly in a diversified portfolio of equity and equity-related instruments and will invest up to 65 -100 per cent in debt, while 0-35 per cent will be done in money market instruments.

Chandraprakash Padiyar, fund manager, UTI AMC said, "UTI MF always endeavours to provide new wealth creation opportunities to its investors. Apart from being a 5 year close-ended equity scheme, it will also utilise derivatives to hedge the portfolio and the extent to which the portfolio will be hedged will be linked to index levels."

Bhojani said, "To satisfy the needs of investors, who think long term, UTI MF is expanding its product suite. The new scheme aims to build and maintain a diversified portfolio of equity stocks that has the potential to appreciate in the long run."