LIC MF eyes Rs 1,000 crore from new money market fund

LIC Mutual Fund is targeting to collect Rs 1,000 crore from its new money market fund launched. The new fund is an open-ended debt scheme that facilitates investing in money market instruments, it said in a statement.

Nityanand Prabhu, executive director and business head of LIC MF, told that it has set an internal target of garnering at least Rs 1,000 crore from the scheme during the primary subscription period.

The fund, targeted mainly at corporate investors, is open for two days for the subscription. It will reopen on August 3, Rahul Singh, a senior fund manager — fixed income & a vice-president at LIC Mutual Fund, said.

Prabhu said the fund launch comes at an appropriate time as spreads between corporate bonds and the repo rate are retracing towards their mean of 1.07 per cent, making money market funds a favourable option to invest.

The fund proposes to invest in money market securities having up to one-year maturity, along with an option to invest in both sovereign and money market instruments to arrive at an optimum asset allocation between the asset classes, Singh said.