Fidelity Mutual Fund today announced the launch of Fidelity Short Term Income Fund, an open-ended income scheme that aims to generate reasonable returns primarily through investments in fixed income securities and money market instruments.
The NFO for the fund will open from November 19 and closes on November 30.
"At a time when investors have turned risk averse with hardening interest rates and increasing equity market volatility, we believe that Fidelity Short Term Income Fund could provide reasonable returns even over shorter periods of time," Fidelity Investment Managers Managing Director and Country Head - India Ashu Suyash told reporters here.
The fund presents a key building block for the asset allocation plans of retail and high net-worth investors and is in line with our overall objective of helping investors in reaching their financial goals.
"With this launch, we hope to reach out to a wide section of investors with an investment option that will leverage our expertise in bottom-up credit research to provide better post-tax returns over other interest bearing instruments including deposits," Suyash said.
"In the current environment where short-term yields have moved up significantly, on a risk-adjusted basis, short-term income funds provide a good opportunity for investors to benefit from the higher yields, yet keeping interest rate risk at an acceptably low level," Fidelity Short Term Income Fund's Fund Manager, Shriram Ramanathan said.
The fund has been assigned the Credit Risk Rating mfAAA by Icra, which indicates that the underlying portfolio has the lowest credit risk and the highest degree of safety from credit losses.
Fidelity Mutual Fund has 13 funds and its assets under management (AUM) is estimated at Rs 8,900 crore.
