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Kotak Mahindra Asset Management Company Limited (Kotak Mahindra Mutual Fund) announced the introduction of the Kotak Global Innovation Fund of Fund, which will enable investors to invest in global innovators such as Amazon, Facebook, Visa, AstraZeneca, and Netflix, among others.

Fund strategy

The Kotak Global Innovation Fund of Fund will invest in Wellington Global Innovation Fund units, which invest in these types of stocks using a disciplined investment and risk management strategy.

Wellington Management, a renowned US-based investment management firm with over $1 trillion in AUM, manages the underlying fund and employs a bottom-up stock selection process based on the score assigned by a proprietary methodology called TIBR.

Here T stands for companies with trendsetting products or services; I stand for companies capable of building innovative products or services, B represents businesses that have a high entry barrier, and R signifies eliminating those companies that are at a high risk of getting disrupted.

Management views

As per the management, if investors seek a fund that can help them diversify their portfolio across sectors and geographies, the Kotak Global Innovation Fund of Funds may be the appropriate choice.

“Global innovators are world-leading companies that control their own destiny, driving growth through innovation or having exposure to key secular trends. We believe that innovation can drive growth, independent of the global economic cycle,” said Harsha Upadhyaya, President & CIO – Equity, Kotak Mahindra Asset Management Company.

The fund is benchmarked with that of MSCI All Country World Index TRI.

What investors should know?

There is no entry load. However, if redemptions/switchouts (including SIP/STP) are done within 1 year from the date of allotment of units, irrespective of the investment amount, 1% would be charged as exit load. The underlying scheme will have a total expense ratio of around 0.90% per annum of daily net assets.

Investors should consult their advisors to check whether the product is suitable for them as the product falls under the category of ‘Very High’ risk-o-meter. This product is suitable for investors who are looking for long-term capital growth.

The scheme offers a regular plan, i.e., investors who desire to invest directly with a distributor, and a direct plan, i.e., for the investors who purchase/subscribe to units in a scheme directly from the fund house. The minimum subscription amount starts from Rs 5,000/- and in multiple of Re 1/- thereafter.