Quantum Ethical Fund - Direct (G): NFO Details

Quantum Ethical Fund - Direct (G) is an innovative investment initiative designed to align financial growth with ethical and sustainable principles. Leveraging advanced quantum computing technologies, the fund employs sophisticated data analysis and predictive modeling to identify high-potential investment opportunities in companies and projects committed to environmental, social, and governance (ESG) criteria. By integrating cutting-edge technology with a steadfast commitment to ethical investing, Quantum Ethical Fund - Direct (G) empowers investors to achieve long-term financial returns while fostering a positive impact on society and the planet.

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Details of the NFO: Quantum Ethical Fund - Direct (G)

Investment Objective and Strategy

Objective:

The Investment Objective of the scheme is to achieve long-term capital appreciation by investing in Equity & Equity Related Instruments of companies following an Ethical Set of Principles.

There is no assurance that the investment objective of the scheme will be achieved.

Investment Strategy:

The Quantum Ethical Fund - Direct (G) employs a disciplined investment strategy that aligns financial growth with ethical principles. The key components of this strategy include:

Ethical Screening: The fund avoids investing in companies involved in sectors such as alcohol, gambling, tobacco, vulgar entertainment, film exhibition, media broadcasting and content, film production and distribution, mainstream/conventional financial services, narcotic substances, leather industries, meat and poultry industries, any form of animal cruelty, and animal testing. 

Financial Screening: Companies are evaluated to ensure that interest-based debt is less than 25% of total assets and interest income is less than 4% of total income. This financial screening is separate from evaluating financial metrics to ascertain a company's financial soundness. 

Integrity Assessment: Companies meeting the ethical and financial criteria undergo further evaluation using Quantum's proprietary integrity framework. This assessment examines governance practices, regulatory risks, and future preparedness, focusing on non-financial aspects of a company's behavior with its various stakeholders. 

Portfolio Construction: The fund aims to construct a diversified portfolio of 30 to 50 stocks that pass the ethical, financial, and integrity screenings. Sector weightings are aligned with broad, well-diversified indices for the Indian equity markets, subject to ethical screening. The allocation to individual stocks is based on their integrity scores, with guardrails around index sector ranges. 

By integrating these elements, the Quantum Ethical Fund - Direct (G) seeks to achieve long-term capital appreciation while adhering to a comprehensive ethical framework, allowing investors to align their financial goals with their personal values.

Why Invest in Quantum Ethical Fund - Direct (G)?

Investing in the Quantum Ethical Fund - Direct (G) offers a unique opportunity to achieve financial growth while supporting ethical principles. Here are key reasons to consider:

Ethical and Values-Driven Investing: The fund strictly adheres to ethical investment principles, excluding sectors such as gambling, tobacco, alcohol, and others considered harmful to society. It supports companies that comply with high standards of corporate governance, sustainability, and social responsibility.

Comprehensive Screening: Investments undergo rigorous ethical screening, financial scrutiny, and an integrity assessment to ensure alignment with values and financial soundness. This multi-layered approach ensures only the most ethical and financially robust companies are included in the portfolio.

Portfolio Diversification: The fund builds a diversified portfolio of 30-50 stocks across sectors that meet ethical and financial benchmarks. This helps mitigate risk while maximizing potential returns in the long term.

Alignment with Personal Values: Investors who prioritize sustainability, governance, and social equity can align their investments with their principles. It empowers individuals to make a positive impact through their investment choices.

Expertise and Innovation: The fund leverages Quantum's proprietary integrity framework, which evaluates non-financial aspects such as governance practices and regulatory risks. With a focus on future preparedness, the fund identifies companies with long-term growth potential.

Sustainable Long-Term Growth: By focusing on companies with strong ethical and governance standards, the fund aims for stable and sustainable growth. Ethical companies often demonstrate better resilience and adaptability, enhancing long-term returns.

Transparency and Accountability: The fund provides transparent reporting and ensures alignment with ethical benchmarks, giving investors confidence in their investment decisions. Investing in the Quantum Ethical Fund - Direct (G) allows you to grow your wealth responsibly while contributing to a more ethical and sustainable future.

Strength and Risks - Quantum Ethical Fund - Direct (G)

Strengths:

The Quantum Ethical Fund - Direct (G) offers several strengths that make it an attractive option for investors seeking to align their financial goals with ethical principles:

Ethical Compliance: The fund adheres to a strict ethical framework, excluding investments in sectors such as alcohol, gambling, tobacco, vulgar entertainment, film exhibition, media broadcasting and content, film production and distribution, mainstream/conventional financial services, narcotic substances, leather industries, meat and poultry industries, any form of animal cruelty, and animal testing.

Proprietary Integrity Framework: Utilizing Quantum's proprietary integrity framework, the fund evaluates companies based on governance practices, regulatory risks, and future preparedness, ensuring that investments align with high standards of integrity and accountability.

Disciplined Investment and Research Process: The fund employs a rigorous investment strategy, constructing a diversified portfolio of 30 to 50 ethically curated stocks. This disciplined approach aims to achieve long-term capital appreciation while adhering to ethical principles. 

Financially Sound Investments: Companies included in the portfolio undergo financial evaluation to ensure they are financially sound, with interest-based debt less than 25% of total assets and interest income less than 4% of total income.

True to Label Fund: The fund maintains its ethical compliance by ensuring that porcontinue to meet ethical criteria. If a company no longer aligns with the ethical framework, the fund manager will exit the investment, maintaining the integrity of the portfolio.

By integrating these strengths, the Quantum Ethical Fund - Direct (G) provides investors with an opporong-term financial growth while adhering to a comprehensive ethical framework.

Risks:

Investing in the Quantum Ethical Fund - Direct (G) involves several risks that potential investors should carefully consider:

Market Risk: As an equity fund, the Quantum Ethical Fund - Direct (G) is subject to market volatility. Fluctuations in stock prices due to economic conditions, geopolitical events, or changes in investor sentiment can impact the fund's performance.

Sector Concentration Risk: The fund excludes investments in certain sectors such as alcohol, gambling, tobacco, vulgar entertainment, film exhibition, media broadcasting and content, film production and distribution, mainstream/conventional financial services, narcotic substances, leather industries, meat and poultry industries, any form of animal cruelty, and animal testing. This exclusion may lead to a concentration in specific sectors, potentially increasing the fund's exposure to sector-specific risks.

Ethical Screening Limitations: The fund's strict ethical criteria may limit the investment universe, potentially excluding companies that could offer strong financial returns but do not meet the ethical standards. This limitation might affect the fund's diversification and performance.

Liquidity Risk: Investing in companies that meet specific ethical criteria may result in a portfolio with securities that are less liquid. This could pose challenges in buying or selling holdings without significantly impacting their prices.

Regulatory Risk: Changes in regulations affecting the sectors in which the fund invests, or those it excludes, could impact the fund's performance. For example, new regulations promoting or restricting certain industries could affect the availability and performance of suitable investments.

Performance Risk: There is no assurance that the fund's investment objective of achieving long-term capital appreciation will be met. Past performance is not indicative of future results, and the fund's returns may vary.

Investors should thoroughly assess these risks in the context of their individual financial goals and risk tolerance. Consulting with a financial advisor is recommended to determine the suitability of the Quantum Ethical Fund - Direct (G) within a diversified investment portfolio.