Equity Arbitrage Fund - Equity Mutual Funds - ICICI Prudential

ICICI Prudential Equity Arbitrage Fund

An arbitrage fund that seeks to generate low volatility returns by using arbitrage and other derivative strategies in equity markets and investments in a short-term debt portfolio.

Investment Philosophy

The fund is a blend of equity, equity derivative and debt instruments.

  • Equity: The fund aims to have a controlled exposure to equity with a view to have reasonable returns. The fund primarily focuses on large cap stocks and selective participation in the initial public offerings (IPO?s)
  • Equity Derivative: The fund will concentrate on generating reasonable returns with low volatility by predominantly using equity derivative strategies. The Fund Manager may employ a combination of the following strategies:
    Cash arbitrage: Uses the difference between the cash and future price of stocks to enter into equal but opposite positions, simultaneously in both markets, for the same scrip to lock in the price difference.
    Index arbitrage: Takes equal and opposite positions of index futures and corresponding stock futures constituting the index in proportion to their respective weights in the index simultaneously, to lock in the price difference.
  • Debt:The fund has the flexibility of increasing its exposure to 35% in debt securities if the risk?reward ratio is favourable to such an allocation.

Key Benefits

  • It is a suitable investment option to park short term money that also provides tax benefits.
  • It is suitable for all categories of investors including corporate treasuries, high net worth investors and retirees who seek low volatility returns out of arbitrage opportunities in the market.

This product is suitable for investors who are seeking* :

  • Short term income generation solution
  • An equity fund that aims for low volatility returns by using arbitrage and other derivative strategies in equity markets.

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

Key Features


Open-ended Equity fund


Regular & Direct


Growth, Bonus & Dividend

Default Option

Dividend Reinvestment

Application Amount

Rs.5000 (plus in multiples of Rs.1)

Min. Additional Investment

Rs.1000 (plus in multiples of Re.1)

Entry Load

Nil. Upfront commission shall be paid directly by the investor to the AMFI registered Distributors based on the investors' assessment of various factors including the service rendered by the distributor.

Exit Load

If the amount sought to be redeemed or switched out is invested for a period of upto 1 month from the date of allotment - 0.25%; if more than 1 month from the date of allotment - Nil.(w.e.f. 06-04-15)

Redemption Cheques Issued

Minimum Redemption Amt.

Rs.500 (plus in multiples of Re.1)

Systematic Investment Plan

Monthly: Minimum Rs 1,000/- plus 5 post-dated cheques for a minimum of Rs 1,000/- each;
Quarterly: Minimum Rs. 5,000/- plus 3 post-dated cheques of Rs. 5,000/- each.

Systematic Withdrawal Plan

Retail Option: Rs.500 and in multiples of Re. 1/-

Fund Manager

Kayzad Eghlim and Manish Banthia