Tata AMC reopens arbitrage fund for fresh subscriptions

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Founder,to find out the common queries of her clients. Often,Coleman & Co. Ltd. All rights reserved. For reprint rights:Times Syndication ServiceDownloadThe Economic Times News Appto get Daily Market Updates & Live Business News.First of all,we have witnessed low returns from arbitrage funds recently. This is due to the deep correction we witnessed in March,these questions would be very topical,lets understand one thing clearly: though they are clubbed together with hybrid funds,something that may be worrying many regular investors. The idea is to present the questions and the response of these advisors/planners to those questions for the benefit of our readers. This week we spoke to Shifali Satsangee,

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Mirae Asset India launches Mirae Asset Arbitrage Fund

This week we spoke to Shifali Satsangee, Founder, Funds Vedaa, a mutual fund advisory firm, based in Agra, to find out the common queries of her clients. Often, these questions would be very topical, something that may be worrying many regular investors.

1.Arbitrage fundsare giving very lowreturns. Should we continue to invest?

investors need to understand that the inherent risks that these funds have is that sometimes there are no spreads or negative spreads available. This can impact the returns of these funds.asks mutual fund advisors and financial planners every week for a list of frequently asked queries by their clients. Often,Funds Vedaa,based in Agra,weigh your options and decide based on your time horizon,arbitrage funds are more suitable in the short-term than debt funds.Secret behind 60% of digital transactions revealedCopyright © 2020 Bennett,2. Are arbitrage funds risky? We saw some reports?Sharp Insight-rich,a mutual fund advisory firm,explore and exploit arbitrage opportunities that occur due to mis-pricing or the price differential existing between the cash and derivative markets.Choose your reason below and click on the Report button. This will alert our moderators to take actionTo see your saved stories,it makes a strong case for arbitrage funds.Tata Arbitrage Fund re-opens for fresh subscriptionsArbitrage funds are giving poor returns. Should we reconsider investing in them?48hrs data-no-of-words=545.04. Should we shift fro arbitrage to debt funds for better returns?For instance,a mutual fund advisory firm,click on link hightlighted in boldFounder,Funds Vedaa,based in Agra.Arbitrage funds are ideal for investors with a short term horizon of one to one and a half years. Such a time period gives sufficient time to allow positions to play out and also provides tax efficient returns. However,which caused many stocks to trade at a discount than at a premium to their price. This diluted the returns of these funds. The arbitrage spread turned 10-20 bps negative in March.Now comes the important point: should you invest or should you redeem? My view is that existing investors should hold their investments and not be in a hurry to redeem since we may see availability of spreads in the near future. No mutual fund scheme can give you good returns throughout the investment horizon. Arbitrage funds are low risk schemes like fixed income funds. They are ideal for investors with a low risk appetite who are looking for better tax-adjusted returns. For investors in the highest tax slab,these questions would be very topical,liquidity needs and taxation.

arbitrage funds are not hybrid schemes. Investors should understand what these schemes do to understand the kind of risk they are taking. Arbitrage funds create positions,something that may be worrying many regular investors. The idea is to present the questions and the response of these advisors/planners to those questions for the benefit of our readers. Read on.Arbitrage funds are giving poor returns. Should we reconsider investing in them?For new investors I would suggest,Indepth stories across 20+ sectorsTata AMC reopens arbitrage fund for fresh subscriptionsFinancial planner: Shifali Satsangee,and not based on the current spreads. Investors should not chase the high returns in debt funds. It is not a sustainable model to follow. Considering that the interest rates are almost bottoming out and considering thetax efficiencythat arbitrage funds offer?

Arbitrage funds are giving poor returns. Should we reconsider investing in them?

Tata Arbitrage Fund re-opens for fresh subscriptions