Edelweiss Mutual Fund is the first asset management company to launch a multi-manager fund out of Gift City, designed for non-resident Indians (NRIs) and overseas citizens of India (OCIs). Unlike conventional offerings tied to a single asset manager, the multi-manager equity fund follows an open-architecture model and is not restricted to Edelweiss schemes alone, giving investors broader access to proven managers and styles.
Radhika Gupta, managing director and chief executive officer, Edelweiss Mutual Fund, in an interaction with Mint explains the details.
How is the fund different, and who can invest in this fund?
This fund is part of the restricted class of funds, with a minimum investment of $150,000. We are very bullish on Gift City as a platform, and this multi-manager fund is the first of several funds we will launch. The fund is targeted at NRIs, OCIs, or anyone looking to get exposure to India.
Gift City fills a clear gap by offering investors quality Indian equity exposure with a dollar investment while avoiding the heavy paperwork that normally comes with such investments. With this fund, instead of investors opening accounts with multiple AMCs, choosing different schemes, and tracking their performances individually, they now get a one-ticket India solution.
This is specifically relevant for NRIs who don’t have to deal with multiple account openings, paperwork, or the burden of rebalancing across different funds. All of that is consolidated into one seamless fund.
Through this single fund, investors receive exposure to eight different schemes across flexicap and midcap categories, making it a one-stop India equity solution.
The fund has a 60% flexicap and 40% midcap allocation. Why this split, and what’s the investment strategy?
We wanted to provide broad-based exposure to Indian equities, and we believe that must include mid and small caps. These areas offer wider sectoral diversification and represent the engines of India’s growth over the next 8–10 years, spanning sectors such as healthcare, capital markets, and discretionary consumption.
Flexicap funds in the industry usually lean about 70% large cap and 30% mid cap, which means investors often end up underexposed to mid and small caps. By designing a portfolio with 60% flexicap and 40% midcap allocation, we create a balance: about 40% large cap exposure and 50–60% mid and small cap exposure overall. In effect, this behaves like a multi-cap strategy.
The fund selection itself follows a disciplined, multi-step process. We start with the top 15 AMCs by equity AUM and screen only flexicap and midcap funds with a minimum 10-year track record, excluding those with cash calls or international exposure beyond 10%. These funds are then scored on both quantitative and qualitative factors — three- and five-year trailing and rolling returns, percentile rankings, information and Sharpe ratios, alongside a qualitative AMC score. A composite ranking is created with 70% weight to quantitative metrics and 30% to qualitative.
We deliberately chose flexicap and midcap funds because these are well-established fund categories with long track records and proven performance in the Indian market.
Given the multi-manager structure, how do you address concerns around overlapping portfolios or layered costs?
Layered cost is not a major concern. NRIs usually face two layers of costs—the platform cost and the India fund cost. In our case, the combined cost remains very efficient compared to what overseas investors normally pay for India access. More importantly, the structure takes away the significant burden of research, selection, and monitoring that investors would otherwise face.
Concerns about overlapping funds involve avoiding duplicate holdings and bringing together managers with distinct investment styles. Even if some stock overlap exists, the benefit comes from combining different approaches—growth, value, sectoral focus, or risk orientation.
To ensure true diversification, allocation to Edelweiss funds is capped at 25–30%, and the same applies to any single AMC. This prevents concentration risk and ensures the portfolio genuinely reflects a mix of managers and philosophies. Most investors, whether in India or overseas, rarely hold just one fund, so our approach simply formalises and simplifies what they would do anyway.
What is the onboarding process like for NRIs?
The fund is structured as an AIF, and we offer two onboarding routes. The first is a physical process involving minimal documentation. Since investors are not directly investing in fully domestic Indian schemes, the Indian KYC requirements do not apply.
The second option is completely online, available through the KFintech platform. Here, investors upload their documents digitally, which are then verified through backend checks before approval.
Compared to directly investing in Indian mutual funds, which require far more documentation and sometimes physical submission, our onboarding process is seamless and NRI-friendly.
How long typically does onboarding take if an NRI wants to get started?
Once the documentation is submitted, the process from application to unit allotment usually takes about four to five business days. So, within a week, an NRI can be fully onboarded and invested.
How long does rebalancing take, and how is it managed?
The fund follows an annual rebalancing schedule with a six-monthly review in place. There is a defined methodology that ensures rebalancing is done systematically while avoiding unnecessary turnover. This approach maintains alignment with our investment philosophy while ensuring costs remain under control.