Invesco India Focused 20 Equity Fund Review
Invesco India AMC is coming up focused equity fund that would open for subscription on September 9, 2020. This focused fund invests across market capitalization such as large cap, midcap and smallcap stocks i.e. multicap. This fund would invest a maximum of 20 stocks across market cap. What are the issue details of the Invesco India Focused 20 Equity Fund? Should you invest in the Invesco India Focused 20 Equity Fund NFO or avoid? Let us do the review of this fund in this article.
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What are focused mutual funds?
As the name indicates, focused mutual fund focuses on a limited number stocks in a limited number of sectors, rather than holding a broad or diversified mix. Focused funds generally hold approx 20-30 companies or even less, unlike many other equity funds that hold more than 100 companies.
Issue details of Invesco India Focused 20 Equity Fund (NFO)
This is an open-ended equity mutual fund scheme.
This scheme would open for subscription on September 9, 2020.
This scheme would close for subscription on September 23, 2020.
Since this is an open ended scheme, it would again open for subscription after 5 days from the closure of the NFO period.
This scheme is available in both regular and direct plans.
This plan offers both growth option and dividend option.
This scheme is available for lump sum and SIP investment.
Minimum investment is Rs 1,000 and in multiples of Rs 1 there-off for lump sum investments.
Minimum investment is Rs 500 per month for monthly SIP and for a tenure of 12 months.
The NAV of the fund is Rs 10 per unit during the NFO initial subscription.
There is no entry load to invest in this fund.
There is an exit load of 1% if more than 10% of the total units are redeemed within 1 year.
This scheme is classified as moderate high risk scheme.
Scheme total expense ratio (TER) is estimated at a maximum of 2.25%.
Download Invesco India Focused 20 Equity Fund SID
What is the investment objective of Invesco India Focused 20 Equity Fund?
To generate capital appreciation by investing in up to 20 stocks across market capitalization.
There is no assurance or guarantee that the investment objective of the scheme will be realized.
Who is eligible to invest in this mutual fund scheme?
The following is eligible to invest in this scheme.
1) Resident adult individuals, either singly or jointly.
2) Minors through Parents/Lawful Guardian.
3) Hindu Undivided Family (HUF) through its Karta.
4) Partnership Firms in the name of any one of the partners.
5) Proprietorship in the name of the sole proprietor.
6) Companies, Body Corporate, Societies, Association of Persons, Body of Individuals, Clubs and Public Sector Undertakings registered in India if authorized and permitted to invest under applicable laws and regulations.
You can check the complete list of eligible investors in KIM / prospectus.
Who is the Fund Manager of Invesco India Focused 20 Equity Fund?
The Fund Manager is Mr. Taher Badshah.
What is the benchmark for this scheme?
The benchmark for this scheme is S&P BSE 500 TRI.
What is the allocation pattern in this mutual fund scheme?
This fund investment pattern is as follows:
1) It invests 65% to 100% in equity and equity related Instruments subject to an overall limit of 20 stocks across market capitalization. The risk profile in this segment is high.
2) It would invest 0% to 35% in debt instruments and money market instruments. The risk profile in this segment is low to medium.
3) It would invest 0% to 10% in units issued by REITs and InvITs. The risk profile in this segment is medium to high.
Why to invest in the Invesco India Focused 20 Equity Fund?
Here are a few reasons to invest in such multi cap / focused mutual funds.
1) This mutual fund invests across large cap, midcap and small cap stocks. This provides wider scope of investment options.
2) This fund would focus on 20 stocks. Instead of having too many stocks, focusing on a limited number of stocks can provide greater control on the portfolio.
Also Read: Union Medium Duration Fund opened for subscription – Should you invest?
Some key risk factors you should consider before you invest in such funds
One should consider some of these risk factors / negative factors before investing.
1) This fund focuses and invests in a maximum of 20 stocks that can limit the potential opportunities compared to a fund that focuses 30 stocks or 40 stocks.
2) While investing in large cap stocks are risky, it also invests in small cap and midcap stocks that are high risk.
3) This fund invests up to 35% in debt instruments which are turned to be risky these days.
4) It invests up to 10% in REITs and InvITs which are high risk.
5) You can refer complete risk factors of investing in this particular scheme in SID / KIM / NFO prospectus.
How is the Performance of existing Focused funds in India?
Now, let us look at some of the top performing focused mutual funds so that one can understand how such segment is trending.
How to invest in this focused mutual fund?
After reading the positives and risk factors, if you have decided to invest in this scheme, you can invest in any of the following methods:
1) You can login to your mutual fund account and visit new fund offers sector and invest through the links provided
2) You can directly visit AMC website and invest with the instructions provided.
3) You can invest through 3rd party mutual fund platforms like Mycams, Karvy mutual fund platform etc.,
4) You can approach any mutual fund broker.
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Should you invest in the Invesco India Focused 20 Equity Fund NFO?
Invesco India Focused 20 Equity Fund invests across large cap, midcap and small cap segment, but focuses only for maximum of 20 stocks. This is for high risk investors as it contains midcap and smallcap asset class. This is a new fund, does not have past performance and one cannot assess how it would perform in the future. If you are a high risk investor and would like to test with new multi cap funds / focused funds, you can invest. Otherwise, you can invest in some of the existing top performing focused mutual funds that had already proven its performance in the last 5-10 years.
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They seem to have a good track record with other funds…
Well researched… I missed out on seeing the performance of the Fund Manager on other products.
Thank you Sanjay