Edelweiss Wealth Management floats equity fund
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Edelweiss Wealth Management has floated an open-ended long-short equity fund with a target to raise Rs 1,000 crore (about $137 million) that will invest primarily in instruments such as cash equities, stocks and index derivatives, including futures and options, according to a company statement.

The Edelweiss Dynamic Growth Equity (EDGE) Fund expects to capitalise on market dynamics by participating in both long- and short-side opportunities and generate consistent returns over the long term with reduced volatility, the firm said.

Last month, VCCircle reported that Edelweiss Asset Management, the alternative investment arm of Edelweiss Group, aims to float a fund with a target size of $900 million-$1 billion (about Rs 6,558-7,287 crore).

The elevated volatility seen in the markets in the past year has resulted in sharp drawdowns and quick erosion of investor wealth garnered over the years. The EDGE Fund aims to address this challenge.

The Category III alternative investment fund (AIF) will follow a target-based investment approach and employ complementary strategies to smoothen returns across market cycles while limiting drawdowns during periods of extreme volatility.

“We believe it’s necessary to have a bifocal approach to investing in order to protect our portfolios against market volatility while generating wealth consistently over the long term,” said Nitin Jain, MD & CEO, Edelweiss Wealth Management.

“A long-short style of investing meets this requirement since it is a more active, bottom-up approach to investing with the added advantage of being able to go short on companies or indices during adverse market scenarios while maintaining low net exposure on the portfolio,” he added.

The EDGE Fund is targeted at high net-worth individuals (HNIs), family offices and institutions. The portfolio is segregated into three strategies, each having defined allocations, return expectations and hedging policies. The fund has a minimum investment amount of Rs 1 crore (about $137,240) with an expected corpus of around Rs 1,000 crore.

This includes a portfolio of about 15-20 core long-term holdings, mix of long-short strategies and will follow systematic hedging practices.

Edelweiss Wealth Management has assets under advisory of more than $18 billion (about Rs 1.3 trillion) servicing ~610,000 HNIs, ultra HNIs and over 2,500 of India’s wealthiest families and affluent clients, said the company release.

It offers investment advisory, estate planning, investment management, securities and broking for individuals and institutions, CXOs, professional investors and family offices.

Edelweiss Wealth Management is offering this product through ESL Securities Ltd, which is the investment manager to the AIF schemes.

Earlier this year, the alternative asset management arm of Edelweiss Group said it is eyeing three new growth strategies to complement its flagship funds.

Edelweiss Alternative Asset Advisors Pvt. Ltd hopes to gradually explore AIFs in commercial real estate, infrastructure debt and mid-yield credit (called core credit) over the medium term.

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