Canara Robeco FORCE Fund NFO: Review Analysis & Details

Another mutual fund house has decided to come out with its NFO or New Fund Offer. The Canara Robeco Asset Management Company has launched its NFO or New Fund Offer called the Canara Robeco F.O.R.C.E Fund NFO

In this article, we will analyse how good is this Canara Robeco FORCE Fund NFO, whether this Canara Robeco FORCE Fund offers anything new or unique for the investors and whether the investors should invest in Canara Robeco FORCE Fund .

Let's begin with some details about Canara Robeco FORCE Fund.

What are the NFO dates for Canara Robeco FORCE Fund ?
The NFO for Canara Robeco FORCE Fund will open on July 20, 2009 and will close on August 18, 2009.

What is so unique about this Canara Robeco FORCE Fund ?
This fund is expected to focus on the BFSI, Enetertainment & Retail sector, as per the reports.
The asset allocation is expected to be done only in these sectors in the following proportions:
 - minimum of 40% and a maximum of 65% in the BFSI sector
 - minimum of 15% and a maximum of 35% in the entertainment sector and
 - minimum of 10% and a maximum of 25% in the retail sector

Investment will be in equity and equity related instruments, foreign securities, government securities & money market instruments.

The Canara Robeco FORCE Fund will be benchmarked to S&P CNX Nifty.

As per the fund manager Anand Shah, the fund is going to bet on India's long term growth story. However, to me it appears that the selection of the sector - BFSI, Entertainment and Retail, may be a bit limited. If someone has to bet on India's growth, then Infrastructure cannot be left out. Recently, there have been so many Infrastructure funds NFOs. Secondly, Energy and power sector also may not be left out.


Minimum Investment: Retail Plan Minimum amount: Rs. 5,000.00 and multiples of Re.1.00 thereafter. Subsequent purchases: Minimum amount of Rs. 500.00 and multiples of Re. 1.00 thereafter. II. Institutional Plan Minimum amount:Rs. 5,00,00,000.00(Rs. Five Corores) and multiples of Re.1 thereafter. Subsequent purchases: Minimum amount of Rs.5,00,000.00(Rs Five Lakhs) and multiples of Re.1.00thereafter.

Mutual Fund NFO offers Currently Open: July 2009

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No Tax Benefit is available in the Canara Robeco FORCE Fund

The entry load for Canara Robeco FORCE Fund is as follows:
SIP/STP/SWP
Entry Load :
• 2.25% for investments of any amount

Exit Load:
• 1% if redeemed/ switched out within one year from the date of allotment
• Nil if redeemed /switched out after one year from the date of allotment

Final Thoughts about the Canara Robeco FORCE Fund?
Overall, this Canara Robeco FORCE Fund is another fund betting on certain key sectors - Banking, Financial Services, Insurance, Retail and Entertainment sector. It appears to provide some diversification, but investors must realize that these sectors are having big correlation to each other - Financial Services grows only when there is lot of money with people, they spend as they have more money, they spend on retail, they spend on entertainment, so if one thing grows, everything grows. However, if there are financial problems, everything gets blocked. Remember what happened with Subhiksha Retail recently, are you still getting good freebies at Reliance Fresh and More stores? So there is a risk of economic problems. Investors have to take the call