Edelweiss Launches India Multimanager Equity Fund – Series I at GIFT City

Edelweiss Asset Management has just launched an exciting new fund in Gujarat International Finance Tec-City (GIFT City). On August 19, 2025, they introduced the Edelweiss India Multimanager Equity Fund, Series I. This fund is designed to make it easier for global investors and NRIs (Non-Resident Indians) to invest in India's growing stock market.

How the Fund Works (Fund Structure)

Think of this fund as a special investment vehicle.

• It's called an open-ended Category III Alternative Investment Fund (AIF), following rules set by IFSCA (Fund Management) Regulations, 2025.
• It's also registered with SEBI as a Category I Foreign Portfolio Investor (FPI).
• For Investors: If you're an investor from outside India, you put your money into this Edelweiss fund.
• Management: Edelweiss Asset Management (through its GIFT City branch) then manages this money.
• Where it Invests: The fund then invests your money into various mutual funds run by different companies (AMCs) across India, including some from Edelweiss itself.

What Makes This Fund Special (Fund Offerings)

This fund aims to help your money grow over the long term by investing in well-managed Indian stock market funds. Here are its key features:

• Multiple Managers: It invests in 8 carefully chosen stock funds from top Indian fund houses, including Edelweiss.
• Balanced Investment Mix:
  • 60% of the money goes into "Flexi Cap" funds (which can invest in companies of any size).
  • 40% goes into "Mid Cap" funds (which focus on medium-sized companies).
  • This mix includes Edelweiss's own Flexi Cap and Mid Cap funds, with others selected through a proven process.
• Wide Choice of Funds: The fund picks from the top 15 Indian fund houses, all with at least 10 years of experience.
• Smart Selection Process: Funds are chosen using a detailed method:
  • 70% based on numbers and data (Quantitative).
  • 30% based on expert judgment (Qualitative).
• Efficient Management:
  • The fund always stays invested; it doesn't hold large amounts of cash.
  • Only a small part (up to 10%) can be invested internationally.

How They Choose Investments (Investment Philosophy)

The main goal is to build a strong portfolio by picking the best stock mutual funds from Edelweiss and other companies.

• Target Mix: The fund aims for:
  • 60% in Flexicap Funds
  • 40% in Midcap Funds
• Investing in Other Funds (70-75%):
  • Focuses on the top 3 Flexicap Funds (about 45% of this part).
  • Focuses on the top 3 Midcap Funds (about 30% of this part).
• Investing in Edelweiss Funds (25-30%):
  • About 15% in Edelweiss Flexicap Fund.
  • About 10% in Edelweiss Midcap Fund.

Building Your Portfolio: The Approach

The fund has clear rules for buying and selling investments and deciding how much to put into each.

• Buying and Selling Rules:
  • Buy: They buy when a stock seems fairly priced and has good potential to grow significantly.
  • Sell: They sell when a stock becomes too expensive, if its core business weakens, if investor excitement is too high, or if company actions go against the original investment reason.
• How Much to Invest (Stock Weight/Sizing):
  • Decisions are based on managing risk, not just on how much money is available.
  • Considers the overall size of the portfolio and how easily investments can be bought or sold.
  • Aims for a balance between making money and controlling risk.
  • Keeps some flexibility to invest in new opportunities.

What the Fund Avoids Doing

The fund has a disciplined approach and avoids certain common investment strategies:

1. Big Bets on Single Sectors: They don't put too much money into just one industry, as sector performance tends to follow the broader market over time.
2. Guessing Macro Trends: They don't make investment decisions based on big economic predictions, as these can be unreliable in today's fast-changing markets.
3. Holding Cash to Time the Market: They keep the portfolio fully invested because trying to perfectly time when to buy or sell (by holding cash) is very difficult.

Tax Benefits for Investors

The tax rules for this Edelweiss fund (as an IFSC Cat III AIF) offer some advantages:

• Capital Gains from Indian Stock Mutual Funds: You generally don't pay tax on these gains.
• Capital Gains from Listed Stocks:
  • Short-term gains (held for less than a year) are taxed at 20%*.
  • Long-term gains (held for over a year) are taxed at 12.5%* on amounts above INR 1,25,000.
• Tax for Investors: Generally, investors are exempt from tax on these earnings**.
• PAN and Tax Filing: The fund handles the tax compliance; investors are exempt if they have no other income in India.
• No GST: There's no Goods and Services Tax on the management or performance fees.

*Always check with a financial advisor for your specific tax situation.

In Conclusion

The Edelweiss India Multimanager Equity Fund – Series I offers a clear and well-researched way for global investors and NRIs to invest in India's growth story. By investing in a variety of top-managed Indian mutual funds, it aims to provide a diversified, transparent, and potentially rewarding opportunity in the Indian stock market.

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