SBI International Access – US Equity will invest funds raised from FOF investors mainly in Emundi Funds – US Pioneer Fund. The management of this scheme will be handled by Mohit Jain.
Investors seeking to invest in foreign shares can invest in SBI International Access – US Equity FOF’s New Fund Offer (NFO). However, given the high valuation of the US markets, wealth managers suggest that one-time investment in it should be avoided. Instead, investment in NFO can be done through SIP. Allotment of 10-15 per cent of its portfolio is sufficient for foreign shares.
NFO is the new scheme of an asset management company. Through this, a mutual fund company raises money from investors to invest in instruments such as shares, government bonds.
SBI International Access – US Equity will invest funds raised from FOF investors mainly in Emundi Funds – US Pioneer Fund. The management of this scheme will be handled by Mohit Jain. The NFO of the scheme is open for investment till 15 March. It can be invested with a minimum of Rs 5,000. Its benchmark is the S&P 500 Index. The portfolio of the SBI International Access – US Equity FOF scheme (Emundi Funds – US Pioneer Fund), has a large diversified portfolio. It consists of 40-70 shares. The investment limit in each share is 5 percent.
There are many advantages to investing abroad. This gives the advantage of geographically diversification. India and US markets have very little relation between them. The benefit of currency also becomes a reason for investment. The US economy is worth four trillion dollars. This is the right choice for diversification.
It is a different matter that the US market has climbed very fast in the last decade. According to data from Value Research, the average return of international funds has been 30 per cent in the last one year.
Abhishek Bhatt, head of wealth management at Arihant Capital, says that the SBI International Access – US Equity FOF scheme has a long track record of investing money. Also, he is very diversified. Its holdings include new generation companies in technology, healthcare and other sectors. This will help generate alpha in the long term. The scheme which gives returns above the benchmark is called alpha.
However, financial planners warn investors that they should not invest abroad just because fund houses are launching NFOs and old returns have been good. The planners want the investors not to invest money in them outright.
“There is an additional risk of currency in foreign equity investment,” says S S Shankar, CFP at Creedo Capital. This leads to additional instability. Invest in it only when you understand these risks. SIP would be a good way to invest. ”
SBI International Access – US Equity FOF will give Indian investors the opportunity to invest in rupees which will be converted into US dollars. This money will then be invested in the Emundi Funds – US Pioneer Fund.
Emundi Funds – Highlights of US Pioneer Fund
Emundi Funds – The top holdings of US Pioneer Funds include Microsoft, Apple, Alphabet, Amazon.com, Visa, Analog Devices, International Flavors and Fragrances, Ilanko Animal Health, MasterCard and Schlumberger. The top 5 sectors are IT, Consumer Discretionary, Healthcare, Financials and Industrial. This fund house has a long track record of 93 years. It has adopted a full framework for investment.
