Edelweiss Mutual Fund will convert its Maiden Opportunities Fund, a closed-end equity scheme to capture opportunities in the IPO market, into an open-ended product. The fund with assets of ₹522 crore will be renamed as Edelweiss Recently Listed IPO Fund.
Launched in February 2018 with a maturity of 1,222 days, the fund has returned 16.71% in the past three years as against 13.27% gains in the BSE 500 TRI. The outperformance was driven by stocks such as Dixon Technologies, HDFC Life, HDFC AMC, Amber Enterprises and Gland Pharma.
Existing investors can move out of the fund without paying an exit load till June 29. After that, exits before 6 months will be charged 2%.
Some financial planners believe the theme is still relevant given the huge pipeline of IPOs in the near future. “Investors do not get an allocation in IPOs or book profits too early,” said Viral Bhatt, Founder Money Mantra. “Investors should come in with a five-year time frame because of the volatility.”
Others think investors should get out of closed-ended funds. “If you invested to meet a goal and need the money later this year, it is better to exit the fund and move to a safer debt fund,” said Amol Joshi, founder, Plan Rupee.