Tata Quant Fund to Merge with Tata Flexi Cap Fund by March 2025

Tata Mutual Fund has decided to merge Tata Quant Fund with Tata Flexi Cap Fund. The merge will take place on March 21, 2025. After the merger, all the investors of Tata Quant Fund will become part of Tata Flexi Cap Fund. However, the reason of merger has not been disclosed yet.

Option for Investors to Exit

The investors of Tata Quant Fund can withdraw or transfer their money if they do not agree with this merger without having to pay any extra charges between February 19, 2025, and March 20, 2025.

Tata Quant Fund

Tata Quant Fund is an open-ended equity scheme following a quant-based approach, launched on January 22, 2020. The scheme invests based on internally developed machine learning models to select investments to earn superior returns consistently better than the index and stay away from negative absolute returns. The assets under management (AUM) of the scheme stood at Rs. 71.97 crore with an expense ratio of 2.38% as of December 31, 2024.

Tata Flexi Cap Fund

This Flexi Cap Fund is an Open-ended fund that mainly invests in all company sizes such as Large-Cap, Mid-cap and Small-cap. The main aim of this fund is to help investors to grow their returns by the way of investing in different sectors and company sizes. As of December 31, 2024, the asset under management of this fund was Rs.3,075.39 crore and has an expense ratio of 0.68% for the direct plan.

Reason for the Merger

The exact reason for the merger has not been disclosed but such mergers usually happen to improve fund performance and to make investment options simple. By merging Tata Quant Fund into Tata Flexi Cap Fund, the fund managers may want to take advantage of Tata Flexi Cap Fund’s ability to invest in companies of all sizes (large, medium, and small). This merger could help to increase returns and reduce risks

Effect on Investors

Mergers of these funds can change the fund’s investment strategy, risk level, and costs for investors. Then in this case, Tata Quant Fund’s investors will move to a more flexible and diversified investment approach from a rule-based investment strategy (quant-based) with Tata Flexi Cap Fund. Investors should think about whether this new approach matches their financial goals and risk-taking ability.

Such mergers can lead to change in investor’s investment objectives, risk levels, and costs. Then in this case, the Tata Quant Fund’s investors will move to a diversified and flexible investment approach from a quant-based investment approach under the Tata Flexi Cap Fund. Investors should think about whether this new approach matches their financial goals and risk-taking ability.

Advice for Investors

Investors should read Tata Flexi Cap Fund’s documents to understand its investment strategy, risks, and past performance. Talking to a financial advisor can also help in making the right decision.

Even though this merger aims to create a better investment option, investors should check if it fits their financial plans. If not, they can decide to exit during the allowed period.