Axis Special Situations Fund: Investment Objective, Features & Benefits

What is a special situations fund?

A special situations fund follows an investment strategy where it tries to take advantage of a special situation which might lead to an increase in the value of a particular asset in future. A special situation arises when an investor senses an investment opportunity beforehand and makes an investment decision with the anticipation of generating decent capital appreciation through that investment in the near future. Special situation schemes focus of such peculiar goals and direct investments towards these goals. Such schemes predominantly invest in equity.

Why should investors consider investing in special situations fund?

Power of purpose – Goal based investing increases investor's commitments to their life goals by enabling them to gauge tangible progress towards their goals and reduces negative behavioral biases such as impulsive decision-making and overreaction.

Save less, achieve more – By identifying long term goals and saving for them in advance, one can invest a lot less over the long term and can potentially achieve much more. Power of compounding will benefit the early investments

Potential of wealth creation – Such schemes where the focus is on long term goals, generally tend to have significant equity exposure. So, such schemes not only target goal achievement, but also have the potential to create long term wealth for the investors

Diversification – Equity investments have the potential to create wealth and fixed income instruments provide stability with relatively lower volatility. It helps to remain focused and unaffected by the short term volatility in the markets

Axis Special Situations Fund

Axis Special Situation Fund is an an open ended equity scheme following special situations theme. It invest in opportunities arising from special situations such as regulatory changes, new technologies, sector dynamics, company specific changes, consumer behavior changes, and global events. It essentially aims to invest in opportunities presented by a changing business environment. It is a multi-cap, multi-sector fund.

Things to consider before investing in Axis Special Situations Fund

If you are keen on investing in Axis Special Situations Fund to target your long term financial goals, here are a few things that you should take into consideration before investing:

Risk appetite

Understanding your risk appetite is essential while investing in equity schemes like Axis Special Situations fund. Do remember that this fund carries an extremely high risk profile and hence it is essential to understand your appetite for risk before investing. Determining one’s risk appetite may help investors evaluate the amount of risk they can take with their finances and also help them realize how much risk they can potentially take in the anticipation of generating capital appreciation over the long term.

Investment objective

There’s no point in considering an investment in a scheme whose investment objective doesn’t align with that of the investor. Sometimes investors blindly invest just looking at the scheme’s past performance. However, one should understand that a mutual fund scheme may or may not be able to deliver a similar performance in the present or future. Just like determining one’s risk appetite is essential, investors need to also understand whether the investment objective of the fund holds the potential to help them with their income needs.

Decide whether you want to start a SIP or make a lumpsum investment

A mutual fund scheme is generally available in SIP and lump sum investment option. A lump sum investment toward a mutual fund scheme is generally made at the beginning of the investment cycle. Investors are allotted units in quantum with the investment amount and depending on the fund’s existing net asset value (NAV). A SIP (Systematic Investment Plan) on the other hand is easy and hassle free way to invest in mutual funds. A KYC compliant individual can invest in mutual funds via SIP from the comfort of their home using a laptop or a smartphone with a decent internet connection. Once the investor completes a onetime mandate with their bank, every month on a fixed date a predetermined SIP amount is debited from their savings account and electronically transferred to the fund. Investors can even refer to an online SIP calculator to determine how much money they need to invest at regular intervals in order to achieve the desired corpus over the long term.

Do consult a financial advisor to get a wider perspective on Axis Special Situations Fund.

Axis Special Situation Fund

(An open ended equity scheme following special situations theme)

Mutual Fund Investments are subject to market risks, read all scheme related documents carefully