On Monday, Franklin Templeton (India) Mutual Fund (MF) announced the opening of its first debt fund since closing six of them suddenly in 2020 due to a problem caused by the fund's closure.
Rahul Goswami, Chief Investment Officer (CIO) - Fixed Income, who was employed by the fund company last year to revitalize its debt vertical, will co-manage the new offering, the Franklin India Ultra Short Duration Fund.
According to a release from Franklin Templeton MF, the fund will be launched on Monday and will invest in debt and money market instruments such as bonds, certificates of deposit, treasury bills, non-convertible debentures, commercial papers, and government securities. The portfolio's Macaulay duration will be between three and six months.
One of the six offers that was closed in 2020 was the ultra-short duration fund. Only six debt offerings—liquid, money market, overnight, variable rate, banking & PSU, and corporate debt—have been made by the fund company since that time.
"If investors want to manage their emergency money or short-term liquidity demands, this fund can be a useful addition. With the present macroeconomic conditions and the anticipation of a steepening yield curve due to excessive liquidity, the fund seeks to position itself to provide conservative fixed-income investors with a mix of capital growth and income," Goswami stated.
The decision to liquidate the six schemes, which had combined assets of over Rs 25,000 crore, was made back in 2020 as a result of a pandemic-related shadow banking issue and limited liquidity. Investors have since received payment in full against their units.
