Dear Investor,

PPFAS Mutual Fund had released an addendum informing about fundamental change in the attributes in their flagship scheme – Long Term Value Fund. Let us understand this change and see if it affects us. The proposed change in asset allocation is:

In other words, to include REITs and InvITs in the universe of available securities for investment.

As of now, only 3 listed instruments are available for investment – IndiaGrid, IRB InvIT and Embassy. Of these, first two are not doing very great. There are few other privately placed issues from DLF, Piramal etc but I don’t believe PPFAS will put invest in unlisted space.

A decent REIT/InvIT will yield about 8%-11% annually, which is not bad considering that about 20% of assets are in arbitrage earning around 6%. I believe the investment in this space may not happen immediately. As and when it does happen in future, I am sure the fund managers will vet the investment ideas thoroughly because they have skin the game.

There is no reason to exit the investment as of now. As usual, we will continue to monitor the developments. In future, if we notice that the objectives of the scheme are not in sync with our goals, we will take a call then.  Until then, stay invested.