Axis Mutual Fund NFO: Axis Income Plus Arbitrage Passive FOF

Axis Mutual Fund has launched a new and innovative investment opportunity, the Axis Income Plus Arbitrage Passive Fund of Fund (FOF). This latest Axis Mutual Fund NFO aims to provide investors with a unique combination of stability, predictable returns and enhanced tax efficiency. Designed as an open-ended scheme, the fund will appeal to those seeking a reliable, low-to-moderate-risk investment with a medium-term horizon.

The New Fund Offer opens for subscription on October 28 and will close on November 11. The mutual fund scheme will be managed by a team of experienced fund managers, named Devang Shah, Aditya Pagaria, Hardik Satra and Karthik Kumar. The fund's performance will be benchmarked against a blend of 65% NIFTY Short Duration Debt Index and 35% Nifty 50 Arbitrage TRI, offering a balanced hybrid metric for assessing returns.

As said by B. Gopkumar, MD and CEO of Axis AMC, "At Axis Mutual Fund, our mission is to deliver innovative, investor-centric solutions that combine simplicity with performance. The Axis Income Plus Arbitrage Passive FOF truly reflects this philosophy, offering an effective mix of predictability, transparency and tax optimization. In a time when investors value steady post-tax returns, this scheme gives them a smarter way to approach fixed-income investing.”

A Hybrid Fund Strategy Balancing Debt and Arbitrage

The Axis Income Plus Arbitrage Passive FOF adopts a dual-structured hybrid fund strategy that blends passive debt mutual fund exposure with arbitrage opportunities. Between 50-65% of the portfolio will be dedicated to passive debt-oriented mutual fund schemes investing in high-quality instruments while following a roll-down strategy. This strategy helps investors benefit from accrual income while reducing interest rate risks.

The remaining 35-50% will be invested in arbitrage funds, which maintain fully hedged equity positions to generate consistent returns with minimal volatility. This hybrid approach enables the fund to achieve debt-like stability with added tax-efficient growth, making it suitable for investors who prefer a balanced & low-risk profile.

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Liquidity, Flexibility & Tax Advantages of the NFO

One of the fund's key highlights is its investor friendly structure, offering T+2 redemption settlements & no exit load, providing high liquidity and flexibility. Furthermore, since rebalancing among the underlying schemes carries no tax implications, the Axis Income Plus Arbitrage Passive FOF ensures efficient compounding of returns without unnecessary taxation.

With a minimum investment of Rs 100 & additional investments in multiples of Re 1, the fund is accessible to all investor categories, including retail, HNIs and corporate clients. It focuses on a new approach to investing that combines passive and hybrid strategies. The main goals are to ensure predictability and to make tax outcomes more efficient.

Why invest in Axis Income Plus Arbitrage Passive FOF

The new Axis Mutual Fund NFO stands out for its strong tax advantage. Unlike traditional fixed deposits or debt funds that are taxed at the investor's tax slab rate, this fund qualifies for LTCG (long-term capital gains) taxation at just 12.5% if held for more than 24 months. These tax rates make it a compelling option for investors looking for a tax-efficient investment opportunity that does not compromise on stability or liquidity.

The fund's passive debt component provides clear expected returns if held to maturity. The arbitrage part acts as a buffer to improve after-tax profits. This combination of predictability and tax efficiency fits well with today’s market, where conservative investors are looking for secure alternatives to traditional debt options.

Axis AMC on Market Outlook and Strategy

Ashish Gupta, CIO of Axis AMC, noted, "Given the current fixed-income landscape, where accrual opportunities are improving and tax-effective income is in demand, the Axis Income Plus Arbitrage Passive FOF is a timely solution. By leveraging passive roll-down strategies along with fully hedged arbitrage exposure, we are giving investors a predictable and transparent experience that supports consistent returns.”

This Axis Mutual Fund NFO reflects the growing shift toward hybrid fund strategies that integrate passive components with innovative tax planning. For investors seeking a balance between security, performance and tax-friendly investing, the Axis Income Plus Arbitrage Passive FOF offers a modern and strategic way to approach fixed-income assets.

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