New Fund Offer - ICICI Prudential Target Returns Fund

Buying at the right time is not the only factor in making profits; one has also to book profit or sell at the right time. However, it works against the basic human instinct of greed to sell when markets are performing. This fund will help investors in systematically booking profits at the predetermined levels. Having said that, an individual with disciplined approach can do it without investing in this fund or even other existing and forthcoming fund can give such facility. Furthermore, it will also limit the upside in case of higher return potential.
Objective: It is an open-ended diversified equity fund that seeks to generate capital appreciation by investing in equity or equity-related securities of large market capitalisation companies constituting the BSE 100 index and providing investors with options to withdraw their investment automatically based on triggers for pre-set levels of return as and when they are achieved.
Strategy: The fund will invest in companies that form a part of BSE 100. The fund will follow bottoms-up approach in selecting companies. And based on individual risk appetite, investors can select from a set of four triggers viz. 12, 20, 50 and 100 per cent. On achieving the pre-set trigger, either the appreciation in NAV per unit or the entire investment (as selected by the investor) will be switched into any of the four pre-selected eligible debt schemes.
Fund Manager, AMC Performance:
Sanjay Parekh will manage this scheme. At ICICI Prudential, Sanjay manages funds like Power and Fusion Fund - Series II. And, both the funds have performed moderately as compared to its category in the long run. However, ICICI Prudential is the third largest AMC in terms of its AUM as on March 31, 2009.
Suitability & Recommendation:
The fund is alike any other large-cap oriented fund. Moreover, looking at the fund manager’s track record, we would rather suggest investors to skip this fund.