New Delhi: DSP Investment Managers has announced the launch of DSP Nifty SDL Plus G-Sec June 2028 30:70 Index Fund, an open-ended Target Maturity Index Fund, which will mature after nearly six years in June 2028.
In line with the Nifty SDL Plus G – Sec June 2028 30:70 Index, the portfolio will be invested in government securities with a 70:30 split between Government Securities (G-Secs) and State Development Debt (SDL) respectively.
There are dual filters in the portfolio for selecting SDLs. Instead of just applying a liquidity filter, there is an additional quality filter of low leverage. This quality filter is based on the ratio of each state’s total liabilities to its GDP and the top 10 states/UTs with the best quality scores will be selected.
The portfolio will consist of highly liquid government securities and a select list of SDLs with low leverage and high liquidity, all maturing during the 12-month period ending June 30, 2028.
According to the asset management company, the fund offers investors the potential for relatively stable and predictable returns.
Investors who subscribe during the new fund offer and stay invested till the stipulated maturity can get a total indexation benefit of seven years.
The new fund offer opened for subscription on March 11 and will close on March 17.
“Around 70% of the investment in the fund is in government securities. The spread between G-Sec and SDL is one of the lowest ever. At such low spreads, it makes sense to invest more in government securities than in SDLs, given the relatively safe risk profile of government securities. At the same time, we believe that the growth of the yield curve is sharp until 2028, and after that its growth is relatively low. As the annual spread rises till 2028 and then flattens out, the six-year point is an attractive point for a projected passive strategy,” says Sandeep Yadav, head-fixed income, DSP Investment Managers.
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