Edelweiss Asset Management Limited (EAMC/EMF), one of India’s fastest-growing AMCs, has launched the Edelweiss Business Cycle Fund. This new open-ended equity scheme, open for subscription from July 9, 2024 to July 23, 2024, employs a business cycle-based investment theme designed to capture market opportunities effectively.

The Edelweiss Business Cycle Fund uses a factor investing approach to create three baskets representing quality, growth, and value stocks. By diversifying across these baskets, the fund minimizes the cyclicality of any single factor.

Within each basket, the fund selects the highest momentum stocks, resulting in a diversified portfolio of 50-60 stocks. The fund aims to dynamically rotate between sectors over different time periods, seamlessly combining momentum with fundamentals to enter and exit sectors, thereby generating better alpha.

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Speaking about the launch, Radhika Gupta, MD & CEO, Edelweiss Mutual Fund, said, “The Edelweiss Business Cycle Fund provides investors with a convenient and unique solution by implementing dynamic sector rotations. This strategy effectively addresses the common challenge of timing sector entries and exits, which investors often struggle with.”

“Momentum has been the best-performing factor in India for many years, and when combined with other fundamental factors, it proves highly effective in generating long-term alpha. Investing across various sectors and market caps, this fund offers a robust solution for core allocation with a long-term focus,” she added.

The fund will be managed by Bharat Lahoti, Co-Head – Factor Investing, and Bhavesh Jain, Co-Head – Factor Investing.