As the Magnum Hybrid Long Short Fund's New Fund Offer approaches its 1 October opening, SBI Mutual Fund has laid out in detail how its debut Specialised Investment Fund is structured — a design the AMC says blends arbitrage income, selective equity upside and active risk management into a single, diversified hybrid strategy.
A layered approach to asset allocation The fund's portfolio construction rests on several distinct layers working together:
Core equity (65–75% of assets): Direct exposure to equity and equity-related instruments, providing the fund's primary growth engine
Hedged derivatives (0–75%): Instruments including index futures, stock futures, options, covered calls and protective puts, used to manage risk around the core equity book
Unhedged short exposure (0–25%): A smaller allocation to naked short positions via derivatives, used to express tactical bearish views within SEBI's prescribed limits
Debt and money market instruments (25–35%): Providing income and stability
REITs and InvITs (up to 10%): Adding a further layer of diversification through alternative, income-generating real assets
This combination is designed to let the fund pursue long-term capital appreciation through an interval structure, rather than depending purely on rising equity markets. As an interval fund, the Magnum Hybrid Long Short Fund allows daily subscriptions but restricts redemptions to twice-weekly windows (Mondays and Thursdays), a liquidity structure common among hybrid SIFs launched during this period and intended to give the fund managers room to execute strategy without the pressure of constant, unpredictable redemption flows.
Who the fund is designed for SBI Mutual Fund has positioned the Magnum Hybrid Long Short Fund as suitable for investors with a moderate-to-high risk appetite who are comfortable with derivatives-based strategies and are seeking consistent returns with some growth potential over a medium-to-long-term horizon — distinct from investors chasing purely aggressive, high-beta equity exposure. The fund's tiered exit load structure (0.50% within 15 days, 0.25% between 15 days and one month, nil thereafter) is designed to discourage short-term trading in and out of the fund, reinforcing its positioning as a medium-to-long-term holding rather than a tactical, short-duration play.
With the ₹10 lakh minimum investment threshold applying across all Magnum SIF strategies at the PAN level, the fund is squarely targeted at HNIs and other sophisticated investors, consistent with SEBI's broader design intent for the SIF category as a whole.