Ambit Good And Clean Multi Cap Fund Product Note


    Ambit Good & Clean Multi Cap Fund

    Investment Objective

    The investment objective of the Ambit Good & Clean Multi Cap Fundis to invest in businesses which have: (a) an impeccable corporate governance track record and best in class accounting practices, and (b) a consistent track record of delivering on growth and returns. The idea is to minimize the risk for the investors and yet pick businesses which will help create wealth in the medium to long term.

    Portfolio is agnostic to market cap and can invest in companies across large/mid/small cap companies. The objective is to generate upside without compromising on the quality of companies (basis accounting quality, corporate governance and improvement in financials).

    Description of Securities and Basis of Selection

    Investments can be made in all the securities including cash equities, futures and options, money market instruments, mutual funds etc. to avail the opportunities available in the market.

    The stocks shall be selected strictly on the basis on the proprietary framework developed in-house by Ambit which focuses on companies that have a proven track record of efficient capital allocation and high growth, but at a reasonable valuation.

    Allocation of Portfolio across types of securities

    • The segment allocation shall be in the following manner:
    • Large Cap - Maximum - 80% of Portfolio; Minimum - 40% of Portfolio
    • Mid Cap - Maximum - 40% of total portfolio
    • Small Cap - Maximum - 20% of total portfolio

    Appropriate Benchmark to compare performance and basis for choice of benchmark

    BSE500. The Fund is Multi Cap with exposure to large, mid and small cap. BSE500 is a broad based index with adequate representation of all segments, and hence represents as a right indicator of performance.

    Investment Approach and Strategy

    • To create a portfolio with an objective to generate capital appreciation over the long term using the above Good & Clean philosophy. The Portfolio Manager shall follow a research based approach for selecting stocks in the portfolio with a combination of top down and bottom up process.
    • The investment approach would be to generate equity returns by investing in firms which are 1) good on capital allocation and financial improvements, and 2) clean on accounting quality and corporate governance.
    • After screening through these frameworks, subjective assessments will be made to narrow down to the final portfolio of stocks.

    Indicative tenure / Investment Horizon: 3-5 years

    Investment Structure and Reporting

    The Ambit Good & Clean Multi Cap Fundshall be operated on “Client Level” basis. All investors’ assets will be in client wise individual separate Bank and Depository Account as the case may be. The Portfolio Manager may at its discretion ordinarily purchase or sell Securities in aggregate for economy of scale and thereafter inter se allocate the same amongst its client on pro-rata basis as per applicable regulations. The portfolio manager shall not hold any securities, belonging to the portfolio account, in its own name on behalf of the clients.

    Additionally, through the Agreement the investor shall provide a Power of Attorney authorizing the Portfolio Manager to perform all his investment decisions and all other obligations.

    All investors shall receive monthly transaction and performance Report. Further, at the year-end an audited performance report specifying the long term, short term and dividend received during the year shall be sent to the investor for assisting him/it to file the returns.

    Eligibility for Investment in the Ambit Good & Clean Multi Cap Fund

    • Resident Individuals, Proprietorship Firms, HUFs, Partnership Firms, Registered Trusts, Corporate, FII and any other eligible investors.
    • Non Residents Indians (NRIs) are eligible to invest in this portfolio but the derivative positions will not be held for NRI. , The portfolios for NRIs shall be managed keeping in view the list of stocks where Reserve Bank of India has barred investments by NRIs. Accordingly the NRIs portfolio may differ to that extent with the other persons in this Product.
    • Furthermore, the individual portfolio of each person may differ based on the various criteria like the corpus amount, residential status or such other criteria, as may be required by the regulations.
    • The portfolio of each client may differ from that of the other client in the same portfolio strategy, as per the discretion of the Portfolio Manager.

    Minimum Investment Amount

    To participate in the Ambit Good & Clean Multi Cap Fundthe minimum investment by the investor shall be Rs. 50 lakhs or as may be provided in the applicable regulations. In the event the Client is interested in investing in the Minimum Investment amount in the form of traded shares or Mutual Fund units, the Client will have to liquidate and make payments to the Portfolio Manager.

    Risks associated with the product

    The portfolio is prone to the following risks: a) There may be a general slowdown in the economy which may lead to a correction in the equity markets thus impacting the returns for the abovementioned PMS fund, b) the portfolio comprises of several companies some of which may experience a slowdown in business growth momentum due to general economic slowdown, industry cycle or wrong business decisions. These above mentioned factors may impact the returns of the investor.

    Risk factor (General)

    All investments under the portfolio are subject to market and other related risks and there is no assurance or guarantee that the value of or return on investments will always be accretive, it could depreciate to an unpredictable extent.

    Withdrawals or Redemption

    Withdrawals from the Ambit Good & Clean Multi Cap Fundcan be requested on any working day and the liquation for the same may take up to 15 working days to execute depending on the liquidity of the portfolio constituents.

    Additionally for investors whose Portfolio value goes below the minimum threshold as provided in the regulations due to withdrawals as per the aforementioned terms and conditions then the Portfolio Manager will have the discretion to close the investors account by liquidation of his position and / or give the shares of the companies invested to the client and /or refund the balance.


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