Mumbai: Edelweiss Wealth Management has launched an equity focused long-short Alternative Investment Fund (AIF) scheme, 'Edelweiss Dynamic Growth Equity' (EDGE) Fund.
The fund has a minimum investment amount of Rs 1 crore and is likely to raise around Rs 1,000 crore.
An open-ended, Category-III AIF, the fund will capitalise on market dynamics by participating in both long and short side opportunities, with an aim to generate consistent returns over the long term while managing volatility, said an Edelweiss Wealth Management statement.
EDGE will invest primarily in instruments like cash equities, stock and index derivatives including futures and options.
"The fund will follow a target-based investment approach and employ complementary strategies to smoothen returns across market cycles while limiting drawdowns during periods of extreme volatility," it said.
These strategies enable the fund to stay aligned to equity markets, capitalise on long and short side opportunities while harnessing the power of derivatives to generate alpha on the portfolio.
Nitin Jain, MD & CEO, Edelweiss Wealth Management said: "We believe it's necessary to have a bifocal approach to investing in order to protect our portfolios against market volatility while generating wealth consistently over the long term."
A long-short style of investing meets this requirement since it is a more active, bottom-up approach to investing with the added advantage of being able to go short on companies or indices during adverse market scenarios while maintaining low net exposure on the portfolio, he added.
"EDGE offers this niche investing strategy and an excellent diversification proposition to investors in comparison to other options available for investments." Jain said.
EDGE is targeted at HNIs, family offices and institutions. The portfolio is segregated into three strategies, each having defined allocations, return expectations and hedging policies.