SCHEME INFORMATION DOCUMENT LIC NOMURA MF DEBT EXCHANGE

Scheme Information Document Lic Nomura Mf Debt Exchange-Free PDF

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Disclaimer, As required a copy of this Scheme Information Document has been submitted to National Stock. Exchange of India Limited hereinafter referred to as NSE NSE has given vide its letter XXXX dated. XXX permission to the Mutual Fund to use the Exchange s name in this Scheme Information Document. as one of the stock exchanges on which the Mutual Fund s units will be listed subject to the Mutual Fund. fulfilling the various criteria for listing The Exchange has scrutinized this Scheme Information Document. for its limited internal purpose of deciding on the matter of granting the aforesaid permission to the Mutual. Fund It is to be distinctly understood that the aforesaid permission given by NSE should not in any way. be deemed or construed that the Scheme Information Document has been cleared or approved by NSE. nor does it in any manner warrant certify or endorse the correctness or completeness of any of the. contents of this Scheme Information Document nor does it warrant that the Mutual Fund s units will be. listed or will continue to be listed on the Exchange nor does it take any responsibility for the financial or. other soundness of the Mutual Fund its promoters its management or any scheme or project of the. Mutual Fund, Every person who desires to apply for or otherwise acquire any units of the Mutual Fund may do so. pursuant to independent inquiry investigation and analysis and shall not have any claim against the. Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in. connection with such subscription acquisition whether by reason of anything stated or omitted to be. stated herein or any other reason whatsoever,LIC Nomura MF DEBT Exchange Traded Fund Page 2. TABLE OF CONTENTS,HIGHLIGHTS SUMMARY OF THE SCHEME 5. 1 INTRODUCTION 7,A RISK FACTORS 7, B REQUIREMENT OF MINIMUM INVESTORS IN THE SCHEME 12.
C SPECIAL CONSIDERATION 12,D DEFINITIONS ABBREVIATIONS 14. E DUE DILIGENCE BY THE ASSET MANAGEMENT COMPANY 21. II INFORMATION ABOUT THE SCHEME 22,A NAME TYPE OF THE SCHEME 22. B INVESTMENT OBJECTIVE OF THE SCHEME 22,C ASSET ALLOCATION PATTERN 22. D WHERE WILL THE SCHEME INVEST 23,E WHAT ARE THE INVESTMENT STRATEGIES 23. F FUNDAMENTAL ATTRIBUTES 24, G HOW WILL THE SCHEME BENCHMARK ITS PERFORMANCE 25.
H FUND MANAGER 25,I INVESTMENT RESTRICTIONS UNDER THE SCHEME 26. J SCHEME PERFORMANCE SO FAR 27,K INTRODUCTION TO EXCHANGE TRADED FUND 27. L DEBT AND MONEY MARKETS IN INDIA 29,III UNITS AND OFFER 31. A NEW FUND OFFER NFO 31,B ONGOING OFFER DETAILS 38. C PERIODIC DISCLOSURES 52,D COMPUTATION OF NAV 54,IV FEES AND EXPENSES 55.
A NEW FUND OFFER NFO EXPENSES 55,B ANNUAL SCHEME RECURRING EXPENSES 55. C LOAD STRUCTURE 56,D TRANSACTION CHARGE 57,V RIGHTS OF UNITHOLDERS 58. VI P E N A LT I ES P E N D I N G L IT I G AT ION OR PROCEEDINGS FINDINGS OF INSPECTIONS. ORINVESTIGATIONS FOR WHICH ACTION MAY HAVE BEEN TAKEN OR IS IN THE PROCESS OF. BEING TAKEN BY ANY REGULATORY AUTHORITY 58,LIC Nomura MF DEBT Exchange Traded Fund Page 3. VI LIST OF OFFICIAL POINTS OF ACCEPTANCE OF TRANSACTIONS 59. LIC Nomura MF DEBT Exchange Traded Fund Page 4,HIGHLIGHTS SUMMARY O F THE SCHEME. Name of the Scheme LIC NOMURA MF DEBT EXCHANGE TRADED FUND. Type of Scheme An Open ended debt scheme listed on exchange as Exchange Traded. Objective To generate return for its investor through investing mainly in sovereign. securities issued beyond 5 yrs by the central and or state government as. permitted by RBI,Benchmark CRISIL 10 Years Gilt Index.
Plan Not Applicable,Options Growth Option only,Dividend option Not applicable. Liquidity The Units of the Schemes can be bought sold like any other stock on. the National Stock Exchange of India Ltd NSE or the Authorized. Participants and Large Investors can directly buy sell Units with the Fund. in Creation Unit size,Face Value INR 10 per unit,Creation Unit size 10 000 units. Creation of Unit The facility of creating redeeming units in Creation Unit size will be. available to the Authorized Participants and large Investors LIC Nomura. MF reserves the right to modify authorized participants on an ongoing. basis The list of authorized participants will be available on the website. of the Fund www licnomuramf com The large investor Authorized. participants can create redeem in 10 000 units and multiples thereafter. Minimum application INR 1 00 000 and in multiples of INR 1 thereafter. amount during NFO, Minimum application 1 Directly from the Mutual Fund. amount on Ongoing Purchases directly from the Mutual Fund would be restricted to. Basis from Mutual Fund Authorized Participants and Large Investors provided the value of. Stock Exchange s units to be purchased is in creation unit size Authorized Participants. and Large Investors may buy the units on any business day for the. scheme directly from the Mutual Fund at applicable NAV and. transaction charges if applicable by transferring stocks or cash. value of which is equal to creation unit size Each creation unit. consists of 10 000 units of LIC Nomura MF DEBT Exchange Traded. The Fund may from time to time change the size of the Creation Unit. in order to equate it with marketable lots of the underlying instruments. 2 On the Exchange, As the Units of the Schemes are listed on NSE an Investor can. buy Units on continuous basis on the capital market segment of NSE. during trading hours like any other publicly traded stock at prices. which may be close to the actual NAV of the Scheme There is no. minimum investment although Units are Purchased in round lots of 1. one Unit and in multiple thereafter,LIC Nomura MF DEBT Exchange Traded Fund Page 5.
Transparency NAV The AMC will calculate and disclose the first NAV not later than 5. disclosure business days from the date of allotment Subsequently the NAV will be. calculated and disclosed at the close of every Business Day which shall. be published in at least two daily newspapers and also uploaded on the. AMFI site www amfiindia com and Mutual Fund site i e. www licnomuramf com, The details of the portfolio shall be disclosed on a half yearly basis as. prescribed by SEBI Mutual Funds Regulations 1996, Listing The units of LIC Nomura MF DEBT Exchange Traded Fund shall be listed. on the Capital Market Segment of the National Stock Exchange of India. NSE The trading will be as per the normal settlement cycle. The AMC reserves the right to list the units of the Scheme on any other. recognized stock exchange,Loads Entry Load Nil, In accordance with SEBI Circular No SEBI IMD CIR No. 4 168230 09 dated June 30 2009 no entry load will be charged on. purchase additional purchase switch in SIP STP transactions The. upfront commission if any on investment made by the investor shall be. paid by the Investor directly to the Distributor based on the Investor s. assessment of various factors including the service rendered by the. Distributor,Exit Load Nil, For further details on Load Structure refer to the section on Load. Structure in this document, Dematerialization The Units of the Schemes are available in dematerialized form This helps.
in consolidating with other portfolio holdings, Risk factors For Risk Factors please refer to paragraph on Risk Factors in this. Repatriation Repatriation benefits will be available subject to applicable conditions. Investors are advised to read the scheme information document carefully before investing. LIC Nomura MF DEBT Exchange Traded Fund Page 6,1 INTRODUCTION. A RISK FACTORS 2,I Standard Risk Factors, 1 Investment in Mutual Fund Units involves investment risks such as trading volumes settlement risk. liquidity risk default risk including the possible loss of principal. 2 The scheme would invest in Equity and Equity related instruments in line with the Investment. objective of the scheme Investments in equity and equity related securities involve a degree of risk. and investors should not invest in the equity schemes unless they afford to take the risk of losing. their investment, 3 As the price value interest rate of the securities in which the Scheme invests fluctuates the value. of your investment in the Scheme may go up or down depending on the various factors and forces. affecting the capital markets, 4 Past performance of the Sponsor AMC Mutual Fund does not guarantee future performance.
of the Scheme, 5 L I C Nomura MF DEBT Exchange Traded Fund is only the name of the Scheme and does not in. any manner indicate either the quality of the Scheme or its future prospects and returns. 6 The Sponsor is n o t responsible or liable for any loss resulting from the operation of the. Scheme beyond the initial contribution of an amount of 2Crs made by them towards setting up the. Mutual Fund, 7 Although it is intended to generate capital appreciation and maximize the returns by actively. investing in equity equity related securities and utilizing debt and money market instruments as a. defensive investment strategy investors may note that AMC Fund Mangers investment decisions. may not be always profitable, 8 LIC Nomura MF DEBT Exchange Traded Fund is not a guaranteed or assured return Scheme. 2 Scheme Specific Risk Factors, The Schemes are subject to the principal risks described below Some or all of these risks may. adversely affect Schemes NAV yield return and or its ability to meet its objectives. 2 1 Risks associated with investing in fixed income securities. 2 1 1 Credit and Counterparty risk Credit risk or default risk refers to the risk that an issuer of a. fixed income security may default i e will be unable to make timely principal and interest payments on. the security or honor its contractual obligations, Counterparty risk refers to the counterparty s inability to honor its commitments payment delivery.
repayment etc and to risk of default This risk relates to the quality of the counterparty to which the. scheme has exposures Losses can occur in particular for the settlement delivery of financial instruments. or the conclusion of financial derivatives contracts. LIC Nomura MF DEBT Exchange Traded Fund Page 7, The value of a fixed income security and OTC derivatives will fluctuate depending upon the changes in. the perceived level of credit and counterparty risk as well as any actual event of default. If the credit rating of an issue issuer or counterparty is downgraded this may cause the value of the. related debt securities or OTC derivatives in which the scheme has invested to fall. The severity of the risk varies depending on the quality of the securities and derivatives in the scheme To. the extent that the scheme invests in high yield bonds this presents a higher than average risk There are. different types of debentures available in the market Some of them could be more risky Lower quality. debt securities and certain types of securities involve greater risk of default or price changes due to. changes in the credit quality of the issuer They are not in the first rank of debts in case of default The. value of lower quality debt securities and certain types of other securities can be more volatile due to. increased sensitivity to adverse issuer political regulatory market or economic developments. 2 1 2 Liquidity Risk The liquidity of the scheme s investment is inherently restricted by trading. volumes in the securities in which the Fund invests. Even though the Government securities market is more liquid compared to other debt instruments on. occasions there could be difficulties in transacting in the market due to extreme volatility or unusual. constriction in market volumes or on occasions when an unusually large transaction has to be put. A lower level of liquidity affecting an individual security or derivative or an entire market at the same time. may have an adverse bearing on the value of the scheme s assets More importantly this may affect the. Fund s ability to sell particular securities and derivatives quickly enough to minimize impact cost as and. when necessary to meet requirements of liquidity or to sell securities in response to triggers such as a. specific economic corporate event, Trading volumes settlement periods and transfer procedures may restrict the liquidity of a few or all of the. investments and may affect the liquidity of the investments of the scheme. The scheme may be unable to implement purchase or sale decisions when the markets turn illiquid. missing some investment opportunities or limiting ability to face redemptions The lack of liquidity could. also lead to the risk that the sale price of a security could be substantially lower than the fair value of the. 2 1 3 Interest Rate Risk Re investment Risk The value of an investment may be affected by. interest rate fluctuations Interest rates may be influenced by several elements or events such as. monetary policy the discount rate inflation etc, The value of debt and fixed income securities held by the scheme generally will vary inversely with the. changes in prevailing interest rates In general price of debt and fixed income securities go up when. interest rates fall and vice versa, Securities of any issuer that has higher duration could be more risky in terms of price movements relative. to those with lower duration Thus any impact of interest rate changes would be higher on securities with. higher duration irrespective of the status of the issuer of the security. SCHEME INFORMATION DOCUMENT LIC NOMURA MF DEBT EXCHANGE TRADED FUND An Open Ended Exchange Traded Fund Offer of Units at NAV based price This product is suitable for investors who are seeking Regular income for medium to long term Investment in Sovereign Securities issued beyond 5 yrs by central and or state government as permitted by RBI Low risk BLUE Investors should consult

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