Mumbai, Nov. 6: Inspired by the success of its new regular income scheme that garnered over Rs 200 crore, the Unit Trust of India (UTI) today launched another scheme called the Variable Investment Scheme (VIS).
The new scheme, which will open for subscription from Thursday, is an open-ended scheme that boasts a dynamic location between equity and debt. It is touted as a unique scheme with multiple “Plans”.
The mutual fund major today announced that gross sales of all its schemes during October crossed Rs 1,186 crore, whereas total repurchases for the period amounted to Rs 840 crore.
UTI said net sales were in positive territory for the second successive month in October, at Rs 346 crore.
“This clearly indicates the positive response from the investing community to both debt and equity schemes of the Unit Trust of India, which have been performing extremely well,” the fund said.
On the Variable Investment Scheme, UTI said: “While each Plan will have similar investment objectives, the universe for equity investment and the methodology adopted for valuation of the universe would vary across Plans”.
The objective of the Variable Investment Scheme is to provide superior risk-adjusted returns through a dynamic asset allocation process. The asset allocation mechanism would aim at decreasing exposure to equity as the valuation goes up and increasing the exposure to equity as the valuation comes down.
The scheme would invest in equity shares of a pre-defined universe and the extent of investment would depend upon the valuation of this universe. The remaining funds would be invested in central government securities/ corporate debt and money market instruments.
Initially on offer will be the Index Linked Plan (VIS-ILP), which would have the BSE sensex as the universe for the equity component of its portfolio. Funds would be invested in equity shares in the same proportion as that in the sensex. The equity component would thus be managed passively as in the case of index equity funds.