Private life insurance provider Bharti AXA Life Insurance on Monday unveiled an Emerging Equity Fund for long-term capital appreciation. This is the first NFO launched by the insurer in more than 13 years. The fund will invest in a portfolio of mid-cap companies, which it says are the future’s blue chips.
The new NFO is a mid-cap investment option that typically is more volatile than large-cap funds. However, mid-cap investment options have the potential to generate higher returns. Since this fund comes with diversification of investment, it lowers the higher risks which are often seen in the mid-cap funds when the market fluctuates rapidly.
“We firmly believe that mid-caps represent the future’s emerging blue-chip companies. This category of stocks possesses the potential to yield robust long-term wealth, outperforming returns from large-cap counterparts. Mid-cap stocks can complement both high-risk and low-risk investment strategies, offering investors a balance of stability and growth,” said Rahul Bhuskute, the Chief Investment Officer at Bharti AXA Life Insurance.
Investors can invest in Bharti AXA Life’s Emerging Equity Fund through three of Bharti AXA Life’s ULIP Plans: Bharti AXA Life Wealth Pro, Bharti AXA Life Grow Wealth, and the newly launched Bharti AXA Life Wealth Maximizer.
“The mid-cap fund will offer higher returns, productivity, and profitability and will also have more growth potential. Since New Fund Offerings allocate their investments to new securities and strategies, they offer improved performance in certain market conditions. Early investors can also get the opportunity to enjoy higher returns as the fund’s performance improves,” the insurer said in a statement.
Speaking on the NFO launch, Parag Raja, MD & CEO, of Bharti AXA Life Insurance said, “We are delighted to introduce our brand-new Emerging Equity Fund. This New Fund Offering marks our first offering in more than 13 years since our last fund launch in 2010. By participating in our New Fund Offering, investors can access the investment market with a modest initial capital during the subscription period, taking advantage of the New Fund Offering’s base value, and potentially reap substantial long-term capital growth.”
Since its inception, the company’s previous five fund offerings have earned a Morningstar rating of 4 and above.
Point to note: If you have a low risk to zero risk tolerance with a short-term investment horizon, this fund may not be the right choice for you. These types of funds are best suited for long-term investors. If you are investing for the short term, then you may not have enough time to ride out any market volatility.