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Pramerica Dynamic Bond Fund
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Year 2012 – Volatility management to drive returns
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In 2010, due to rising interest rates, investors benefited by investing in high accrual short term
investments like liquid funds. In the year 2011, we recommended short term funds. Short term funds
have generally outperformed liquid funds in the year 2011.
We believe that year 2012 is ripe for investing in 'actively managed' bond funds. Short term
interest rates are expected to ease, returns from short term funds are expected to follow suit.
Long term interest rates are expected to remain range bound with increased volatility.
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Take advantage of volatility in longer term securities
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Longer term securities are characterized by relatively higher volatility as compared
to shorter term securities. This volatility offers an opportunity to make tactical
trades for adding to portfolio returns. Such tactical opportunities are available
irrespective of the direction of interest rates.
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To take advantage of the current economic situation, Pramerica Mutual Fund launches |
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Pramerica Dynamic Bond Fund
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The Scheme will use a 2-pronged approach to investments:
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Active Duration Management
Portfolio Strategy would target to identify trends in economic and interest rate environment to exploit short term opportunities across the yield curve. The fund would also focus on opportunities due to change in steepness of yield curve.
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Capturing Opportunities in Credit Spreads
Portfolio Strategy will seek to capture potential changes in credit spreads and credit ratings. The fund will seek to capture volatility in credit spreads in short term as well as long term debt instruments
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Why invest in Pramerica Dynamic Bond Fund?
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Fixed income investments are cyclical in nature with various segments of market performing at various points in time. Investing at the right segment of the fixed income market at the right time makes a difference to the investor’s returns. Pramerica Dynamic Bond Fund seeks to do just that by identifying potential shifts in interest rate environments and actively managing duration for efficient risk return proposition for the benefit of investors.
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Key Information about the Scheme
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Investment Objective
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To generate optimal returns through active management of a portfolio of debt and money market instruments. However, there is no assurance that the investment objective of the Scheme will be realized and the Scheme does not assure or guarantee any returns.
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Asset allocations
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Instruments
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Asset allocations (%)
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Minimum
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Maximum
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Risk Profile
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Money Market securities and Debt Instruments
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0
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100
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Medium
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Benchmark Index
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CRISIL Composite Bond Fund Index
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Minimum application amount
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Minimum of `5, 000/- and in multiples of `1/- thereafter.
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Minimum additional amount
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Minimum of `1,000/- and in multiples of `1/-thereafter.
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Load structure
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Entry Load – Not Applicable
Exit Load – NIL
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Options
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Growth Option
- Dividend Option, with three facilities, namely
- Dividend Reinvestment, Dividend Payout & Dividend Transfer Plan
- At Monthly & Quarterly frequency
(Dividend distribution is subject to availability of distributable surplus)
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Special Products
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SIP, SWP, Switch, STP (During On Going Offer)
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Name of the Scheme: Pramerica Dynamic Bond Fund (An open ended Income Scheme)
Investment Objective - To generate optimal returns through active management of a portfolio of debt and money market
instruments. Asset Allocation: Money Market securities & Debt instruments: 0-100%. The scheme retains the flexibility
to invest across all the securities in the debt and money markets instruments. Terms of issue and sale and
redemption of units: Issue of units of `1,000 each for cash during the New Fund Offer and at NAV based prices
thereafter. The scheme offers sale and redemption facility on all business days during the ongoing offer.
NAV of the Scheme will be calculated and disclosed at the close of every Business Day. Load Structure:
Entry Load: Nil, Exit Load: Nil
Recurring Expenses: Recurring
expenses including the investment management and advisory fee that can be charged to the Scheme shall be
subject to a percentage limit of average weekly net assets @ 2.25% for the first `100 crore; @ 2.00 %, next ` 300
crore; @1.75 % on the next ` 300 Crores; and @ 1.50% on the balance. NFO expenses: To be fully borne by AMC/
Sponsor. Copy of SID/SAI and Key Information Memorandum (KIM) can be obtained from any of our Investor Services
Centers as well as from our website
www.pramericamf.com
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IMPORTANT DISCLOSURES: This document has been prepared
by Pramerica Asset Managers Private Limited (the AMC) on the basis of publicly available information, internally
developed data and other third party sources believed to be reliable. However, no assurances are provided
regarding the reliability of such information. THERE CAN BE NO ASSURANCE THAT ANY FORECAST MADE HEREIN WILL
BE ACTUALLY REALIZED. The information contained herein is current as of the date of issuance
(or such earlier date as referenced herein) and is subject to change without notice. The AMC has no
obligation to update any or all of such information; nor does the AMC make any express or implied warranties
or representations as to its completeness or accuracy.
The AMC is neither a legal nor tax advisor. The information contained herein does not constitute investment or tax advice.
This document does not take into account individual client circumstances, objectives or needs. No determination has been
made regarding the suitability of any securities, financial instruments or strategies for particular clients or prospects.
The information contained herein is provided on the basis of and subject to the explanations, caveats and warnings set
out elsewhere herein. In view of the individual nature of the tax implications, each investor is advised to consult
his or her own professional tax advisor and/or consultant, for advice concerning the investor’s particular situation
with respect to the specific tax and other implications arising out of his/her/its participation in the Scheme &
suitability of the Scheme for the investor’s objective & needs.
This document is not intended for distribution to or use by any person in any jurisdiction where such distribution would
be contrary to local law or regulation.
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Risk Factors: All mutual funds and securities investments are subject to market risks
and there can be no assurance that the objective of the Scheme will be achieved. As with any investment in
securities, the NAV of the units under the Scheme may go up or down depending upon the factors and forces affecting
the securities markets. Pramerica Dynamic Bond Fund is only the name of the scheme and does not in any manner
indicate either the quality of the Scheme, its future prospects and returns. Performance of the Sponsor has no
bearing on the expected performance of the mutual fund or any of its schemes. Past performance of the Sponsor
and their Affiliates/AMC/Mutual Fund & its Scheme(s) does not indicate the future performance of the Scheme
and may not necessarily provide a basis of comparison with other investments. Investment in Mutual Fund Units
involves investment risks such as trading volumes, settlement risk, liquidity risk, default risk including the
possible loss of principal. As the price / value / interest rates of the securities in which the scheme invests
fluctuate, the value of your investment in the Scheme may go up or down. Investors are not being offered any
guaranteed / assured returns under any scheme of Pramerica Mutual Fund. FOR SCHEME-SPECIFIC RISK FACTORS &
TAX IMPLICATIONS, PLEASE REFER TO THE SCHEME INFORMATION DOCUMENT.
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Statutory Details: Pramerica Mutual Fund is set up as a Trust under the Indian
Trusts Act, 1882 and registered with SEBI. Sponsor: Prudential Financial, Inc. (PFI) of the United States of America
[liability restricted to initial contribution of ` 1 Lac towards the corpus of the Mutual Fund]. [Pramerica is the
brand name used by PFI and its affiliates in select countries outside the United States. Prudential Financial,
Inc. of the United States is not affiliated in any manner with Prudential plc, a company incorporated in the
United Kingdom] Trustee: Pramerica Trustees Private Limited. Investment Manager: Pramerica Asset Managers Private
Limited.
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MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS. PLEASE READ SCHEME INFORMATION DOCUMENT & STATEMENT OF ADDITIONAL INFORMATION CAREFULLY BEFORE INVESTING.
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