UTI announces a 'market-nutural' mutual fund

New Delhi, Jun 8 (UNI) The UTI Mutual Fund today announced the launch of a new UTI-SPrEAD Fund, providing its investors an oppurtunity to receive returns, unaffected by the rise or fall of equity markets.

The offer, with Rs 10 as face value of units, opens on June 9 and closes on June 22, 2006, according to an official statement issued today.

The fund will re-open for the continuous purchase and redemption during the interval periods in July.

Minimum initial investment is Rs 5,000, the statement said.

Subsequent minimum investment under a folio is Rs 1,000 and in multiples of Re 1 thereafter with no upper limit, it added.

A ''market-neutral fund'', which offers growth option and dividend option with compulsory reinvestment of dividend, is an open-ended equity fund investing in a mix of equity, equity derivatives, debt and money market instruments.

UTI AMC Chairman and MD U K Sinha said, ''UTI-SPrEAD Fund is an arbitrage fund with tax efficient returns and safety of debt.

Arbitrage is away of reducing the risk of loss caused by price fluctuations of securities held in a portfolio.'' It would be ideal for risk adverse investors as all equity positions would be completely hedged, he added.

UTI AMC Chief Investment Officer A K Sridhar said, ''UTI-SPrEAD Fund will endeavour to enhance returns through arbitrage between spot and futures equity markets.'' UTI Mutual Fund is a SEBI registered mutual fund, with the State Bank of India, Punjab National Bank, Bank of Baroda and Life Insurance of India as its sponsors.

UNI VJ CS HT1905