Franklin Templeton has launched Sapphire Equity Long-Short SIF, its first offering under the SIF framework. The fund uses a quantitative strategy with long and short positions across Nifty 500 stocks. Designed for high-risk investors, it aims to generate alpha through dynamic allocation and disciplined risk management across market cycles.

NFO Alert: Franklin Templeton Mutual Fund launches Sapphire Equity Long-Short SIF

Synopsis

Franklin Templeton has launched Sapphire Equity Long-Short SIF, its first offering under the SIF framework. The fund uses a quantitative strategy with long and short positions across Nifty 500 stocks. Designed for high-risk investors, it aims to generate alpha through dynamic allocation and disciplined risk management across market cycles.

Franklin Templeton (India) has announced the launch of Sapphire Equity Long-Short SIF, its first offering under Specialised Investment Funds (SIF). It is an Equity Long Short Fund under the SIF framework, investing across Nifty 500 stocks to enable diversified exposure across large, mid and small-cap segments.

The new fund offer, or NFO, for Sapphire Equity Long-Short SIF is open for subscription and will close on April 24.

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Sapphire Equity Long-Short SIF aims to seek long-term capital appreciation across market cycles through a proprietary, model-driven quantitative strategy anchored in disciplined stock selection, dynamic allocation and robust risk management.

The investment strategy seeks to generate alpha over the long term by investing across a spectrum of large-, mid- and small-cap companies using long/short equity strategies.

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The performance will be benchmarked against the Nifty 500 TRI and will be managed by Arihant Jain. The minimum investment amount will be Rs 10 lakh (first time) and in multiples of Rs 10,000 thereafter.

“Investors today are navigating markets that move through different phases rapidly, making disciplined and flexible investment strategies increasingly important. SIF is designed for investors with a higher risk appetite, offering the potential for relatively higher returns while also being tax efficient. What differentiates a SIF strategy from a conventional mutual fund is that SIFs can potentially take advantage of market shifts by taking short positions up to 25% of their net assets, which can help reduce downside risk during market corrections,” said Avinash Satwalekar, President, Franklin Templeton India.

He added, “The Sapphire Equity Long-Short SIF leverages Franklin Templeton’s decades of experience in systematic and quantitative investing. Our proprietary, data-driven quantitative approach evaluates stocks using over 40 factors across quality, value, sentiment and alternative indicators, with a dedicated framework for identifying short opportunities. Our SIF is built on a structured, data-driven quantitative approach that evaluates opportunities across equities, while managing risk efficiently through a defined long-short framework.”

“The underlying quantitative model for the strategy is designed to assess stocks using a broad set of leading and lagging indicators, recognising that different factors tend to perform differently across market environments. The framework systematically scores and ranks stocks for both long exposure and selective short positioning, enabling a more balanced response to shifts in the market. The model is designed to adapt while preserving a strong emphasis on risk management,” said Arihant Jain, Portfolio Manager, Sapphire Equity Long-Short SIF.

“Portfolio construction follows a disciplined, research-driven process, where the investment team overlays its judgement with careful consideration of liquidity, sector exposure, size, risk and style characteristics to manage unintended biases. By applying factor insights in a disciplined way on both the long and short sides, the strategy is designed to more effectively express relative views, which could protect alpha in more challenging or down markets. Our differentiator lies in blending dynamic factor insights with oversight on risk and positioning, helping the strategy capture distinctive opportunity while maintaining stability through varied market environments.”

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The fund is suitable for investors seeking long-term capital appreciation and looking to invest in equity and equity-related instruments, including limited short exposure in equity through derivative instruments.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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