EDGE Asset to launch open ended mutual fund

The stock market regulator has given go-ahead to EDGE Asset Management to launch an open ended mutual fund named EDGE High Quality Income Fund.

The mutual fund will have an initial size of Tk 25 crore, out of which EDGE Asset will subscribe Tk 2.5 crore as the sponsor of the fund, according to a press release of the Bangladesh Securities and Exchange Commission (BSEC).

Mutual funds are investment funds that gather a fixed pool of money from several investors and re-invest them into stocks, bonds and other securities and then distribute the profits among the unitholders.

Open-ended mutual funds have no timeframe to mature and are not listed with the bourses.

Brac Bank is the custodian and Sandhani Life Insurance will act as the trustee of the fund.

EDGE Asset Management will also be the manager of the fund.

Nature of the fund is fixed income generating open-ended mutual fund.

It will be invested in a portfolio of fixed and floating rate debt (or fixed income generating) securities and debt obligations issued by government, corporate entities, government-related issuers and nongovernmental organisations based in Bangladesh.

The fund will seek to be the most cost-effective fixed income fund and shall pay a management fee of 1 per cent per annum.

It will pay-out 70 per cent of its annual realised earnings as cash dividends.