Samco has launched the Special Opportunities Fund. This new fund offer will open for subscription on May 17, 2024. It is an open-ended equity scheme that follows a special situations theme and invests in emerging opportunities such as restructuring, turnarounds, spin-offs, mergers and acquisitions, and new trends. Is it something special that creates value for an investor’s portfolio?Should you invest? Samco Special Opportunity Fund NFOWhat are the various risk factors associated with such funds? In this article, let us review all these aspects.?
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Samco Special Opportunity Fund (NFO) issuance details
Details of the NFO issue are as follows:
| Fund name | Samco Special Opportunity Fund |
| NFO is open | May 17, 24 |
| NFO closing | May 31, 24 |
| Scheme re-opened for continued purchase/sale | Within 5 business days |
| Minimum application amount | 5,000 rupees and in multiples of 1 rupee thereafter |
| Minimum SIP | 500 rupees in 12 months |
| Fund NAV | 10 rupees during NFO period. |
| entry road | Nothing |
| End of loading | 2% for redemptions within 365 days |
| danger | very high risk |
| standard | nifty 500 try |
| fund manager | Mr. Umeshkumar Mehta Mr. Paras Mataria Mr. Dhawal Dhanani |
Samco Special Opportunity Fund SID
About Samco Special Opportunity Fund
The Samco Special Opportunities Fund is built on a unique proprietary DISRUPTION model with 10 distinct sub-strategies, each designed to highlight special situations within a diverse theme. The fund seeks to exploit market inefficiencies and generate long-term capital growth through undervalued or overlooked opportunities.
What is the investment objective of this scheme?
The scheme’s investment objective is to invest in a portfolio of securities relating to special situations such as restructurings, turnarounds, spin-offs, mergers and acquisitions, new trends, new and emerging sectors, and digitalization, with long-term capital value. is to achieve improvements in , premiumization, and other special corporate actions. These conditions often create opportunities for mispricing or undervaluation, which funds take advantage of to potentially increase the value of their capital. However, there is no guarantee that the scheme’s investment objective will be achieved.
There is no guarantee that the scheme’s investment objectives will be realized.
What is the allocation pattern of this mutual fund?
The investment pattern of this fund is as follows.
| Type of instrument | minimum% | maximum% | risk profile |
|---|---|---|---|
| Special situation themed stocks and stock-related products | 80% | 100% | very expensive |
| Stocks and stock-related securities of other companies | 0% | 20% | very expensive |
| Debt and financial market instruments | 0% | 20% | Low to moderate |
Why invest in Samco Special Opportunities Fund NFO?
Here are some reasons to invest in mutual fund schemes like this.
- Diversification: By investing in a portfolio of stocks that relate to special situations such as restructuring, turnarounds, mergers and acquisitions, mutual fund schemes offer diversification benefits and spread risk across different sectors and strategies.
- Taking advantage of mispricing and undervalued opportunities: Special circumstances often lead to mispricing and underestimation of opportunities in the stock market. The system’s aim to take advantage of this situation represents an active management approach that seeks potential profits in the presence of market inefficiencies.
- New trends and emerging areas: Investments in new trends, emerging sectors and digitalization can offer high growth opportunities. This is because these sectors often represent industries with significant innovation and disruptive potential.
- Profitability potential: By focusing on special circumstances that create mispriced and undervalued opportunities, this system may offer the potential for increased returns compared to traditional investment strategies.
Important risk factors to consider before investing in such funds
You should consider some of these risk factors/negative factors before investing.
- Special situation risks: Special situations, such as restructuring, restructuring, mergers and acquisitions, may inherently involve risks and may not necessarily produce positive results. In these situations, the investment may not materialize as expected or provide the expected returns, which may result in a loss to investors.
- Liquidity risk: Securities that involve special situations may be less liquid than traditional investments. This lack of liquidity can make it difficult to buy or sell securities at desired prices, which can result in price slippage and the inability to quickly exit positions.
- Concentration risk: The scheme focuses on specific sectors, trends or special situations, which can lead to concentration risk. If a particular sector or theme underperforms, the performance of your portfolio can be significantly affected.
- Regulatory and legal risks: Regulatory changes or unanticipated legal developments may affect the securities held in the Portfolio and the Fund’s ability to execute its investment strategy. Regulatory changes may also affect the tax treatment of investments, which may reduce returns.
- Complete risk factors can be found at: Samco Special Opportunity Fund NFO RHP.
Performance of existing special opportunity funds
There are several funds launched in the last three years and their performance history is as follows. These are annualized returns.
| scheme name | 1 year | 2 years | 3Y |
|---|---|---|---|
| Aditya Birla Sun Life Special Opportunity Fund | 46% | twenty three% | 20% |
| Axis Special Situations Fund | 36% | 20% | 17% |
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Samco Special Opportunities Fund NFO – Should I invest?
Samco Special Opportunities Fund invests based on special situation themes such as restructuring, M&A and emerging sectors. The scheme focuses on exploiting mispriced and undervalued opportunities and aims to improve returns by leveraging professional management expertise and flexibility to adapt to changing market dynamics.
On the downside, despite the potential for capital value appreciation, investing in this scheme comes with inherent risks. Investments in special circumstances involve market, concentration and liquidity risks and may cause investments to fluctuate and lose value.
High-risk investors who understand all these risks can invest in such schemes with a medium to long-term perspective.
Suresh KP is the founder of Myinvestmentideas. He is a NISM Certified Investment Advisor and he is a NISM Certified Research Analyst. I have been analyzing financial markets for the past 20 years. He can be reached at suresh@myinvestmentideas.com.
