Edelweiss Mutual Fund launches a factor-based business cycle fund

Edelweiss Mutual Fund has launched a factor-investing based Business Cycle Fund. The fund house said the scheme will follow a business cycle-based investment theme through a smart beta strategy. 

Explaining the strategy, Edelweiss MF said the fund will create three baskets representing quality, growth, and value stocks. 

"By diversifying across these baskets, the fund minimises the cyclicality of any single factor. Within each basket, the fund selects the highest momentum stocks, resulting in a diversified portfolio of 50-60 stocks. The fund aims to dynamically rotate between sectors over different time periods, seamlessly combining momentum with fundamentals to enter and exit sectors, thereby generating better alpha," the fund house said.