Reliance Mutual Fund NFO for Small Cap Fund opens tomorrow

Reliance Mutual Fund, part of Anil Ambani's Reliance Capital, today announced the launch of new fund offer (NFO) for Small Cap Fund, which will invest in small cap companies.

The NFO would open on August 26 and close on September 9.

The scheme proposes to invest at least 65 per cent of the corpus in equity and equity-related instruments of small cap companies, which may go up to 100 per cent of the corpus, Reliance MF said in a statement.

"We feel that select small caps are potential large caps of tomorrow because of their benefit of high growth prospects. Valuation gap is also visible between small caps and large caps thus giving an opportunity for alpha creation," Sunil Singhania Fund Manager for Reliance Small Cap Fund said.

The minimum investment amount in the said scheme will be Rs 5,000 and investors would have to bear the 2 per cent exit load for holding period less than or up to 12 months and 1 per cent for holding period above 12 months and 'nil' thereafter.

The performance of the fund, which is the first small cap company dedicated fund would be benchmarked against the BSE Small Cap Index.

This fund will offer investors an auto switch facility from Reliance Liquid Fund (Treasury Plan) to Reliance Small Cap Fund during the NFO.

"We at Reliance MF have always been very selective in launching new products and focused on products that offer unique proposition to our investors. We are confident that investors will look favourably at the NFO being offered," Reliance Capital Asset Management CEO Sundeep Sikka said.