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What are Arbitrage Funds?

What are the arbitrage funds
Definition of arbitrage fund
what is arbitrage fund

Arbitrage Funds Carry Low Risk

In an arbitrage transaction, the gain in equity segment is protected against market movements
The fund manager buys ABC Ltd. share at Rs. 300 in cash market and simultaneously sells it in the future market at Rs. 310
At month-end there are three likely scenarios
scenario 1

TO Rs 311

Gain in cash market is
311 – 300 = 11

Loss in futures segment is
310 – 311 = -1

Net Gain: 11 - 1 = 10
scenario 2


Gain in cash market is
300 – 300 = 0

Gain in futures segment is
310 – 300 = 10

Net Gain: 10 + 0 = 10
scenario 3

TO Rs 293

Loss in cash market is
293 – 300 = -7

Gain in futures segment is
310 – 293 = 17

Net Gain : 17 – 7 = 10

Investment Objective

  • The investment objective of the scheme is to generate capital appreciation and income by predominantly investing in arbitrage opportunities in the cash and derivatives segment of the equity market and by investing the balance in debt and money market instruments.
  • However, there is no assurance or guarantee that the investment objective of the scheme will be achieved.
Investment objective

Why NJ Arbitrage Fund?

Lower volatility & riskSince equal and simultaneous positions are taken in cash and futures, there is low risk from share price fluctuations.
Tax-friendlyBeing equity-oriented, they are more tax-friendly than debt funds.
All weather mutual fundSince arbitrage opportunities are available across market phases, investors can invest in them regardless of market conditions.

Who Should Invest?

The fund is suitable for investors who
Who should invest
Investors looking for a stop gap arrangement before they systematically transfer funds (via STP) in an equity-oriented fund later when they believe it is the right time.
Who should invest in abitrage fund
Investors with surplus funds looking for liquidity + tax efficient return will find these funds helpful.

Fund Features

Type of Scheme An open ended scheme investing in arbitrage opportunities
Asset Allocation
Instrument Indicative allocations
(% of total assets)
Risk Profile
Min Max High / Medium / Low
Equity & Equity related instruments 65% 100% High to Very High
Debt and money market instruments* 0% 35% Low to Medium
*TREPS, Government Repo/Reverse Repo (in Government Securities), Treasury bills, Government securities (Issued by both Central and State governments) and any other like instruments as specified by the Reserve Bank of India from time to time and approved by SEBI from time to time.
Benchmark Index Nifty 50 Arbitrage Index
Plan & Options Regular Plan & Direct Plan
Each Plan offers the Growth Option.
Minimum Amount Lumpsum Investment: Rs. 5,000/- and in multiples of Re. 1/- thereof
Additional Application: Rs. 500/- and in multiples of Re. 1/- thereof
SIP Application: Rs.100/- and in multiples of Rs.1/- thereafter
Minimum Redemption Amount There is no minimum redemption criteria
Entry Load Not applicable
Exit Load 1. NIL Exit load - for 5% of the units upto completion of 30 days.
- The "First In First Out (FIFO)" logic will be applied while selecting the units for redemption.
- Waiver of Exit load is calculated for each inflow transaction separately on FIFO basis and not on the total units through multiple inflows.
- The load free units from purchases made subsequent to the initial purchase will be available only after redeeming all units from the initial purchase.
2. All units redeemed /switched-out in excess of the 5% load free units will be subject to the below mentioned exit load.
- 1.00% - if Units are redeemed / switched-out on or before 30 days from the date of allotment.
- Nil - if redeemed after 30 days from the date of allotment.
SIP/STP/SWP Available
Fund Manager Mr.Vishal Ashar
Asst. Fund Manager Mr. Dhaval Patel


Contact Us

Office address :
Unit No. 101A, 1st Floor, Hallmark Business Plaza, Bandra (East), Mumbai - 400051, Maharashtra.

Mail us at :

Investors can lodge complaints as per the Online Dispute Resolution Methodology on the Online Dispute Resolution portal

Contact Number :
1860 500 2888 / 040-49763510
(Monday to Saturday from 9 am to 7 pm)

For SID, KIM, SAI and other related queries, log onto


The riskometer is based on the portfolio of June 30, 2024 and is subject to periodic review and change.

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