Zerodha Fund House has introduced a new type of mutual fund in India called Life Cycle Funds. With this launch, Zerodha has become the first asset management company in the country to offer target-date maturity funds.
The fund house has launched two new schemes — Zerodha Life Cycle Fund 2036 and Zerodha Life Cycle Fund 2041.
These funds are designed for investors with long-term financial goals and automatically change their investment strategy as the target year gets closer.
Investment Mix Changes Automatically
These funds invest in multiple asset classes, including stocks, debt instruments, gold, and silver.
In the early years, the fund will focus more on higher-risk investments such as equities to help generate better long-term returns.
As the target year approaches, the portfolio will gradually move towards safer and more conservative assets.
This automatic shift means investors do not need to regularly adjust their asset allocation on their own.
Where Will the Money Be Invested?
Both schemes will invest in equities linked to the Nifty LargeMidCap 250 Index.
The debt portion will be invested in Government of India securities with different maturities. The funds may also use commodities and arbitrage strategies to diversify investments further.
According to Zerodha Fund House, this approach aims to balance growth and stability throughout the investment journey.
Popular Globally, Now Arriving in India
Target-date funds are already very popular across global markets. Worldwide, these funds manage assets worth more than $4 trillion and are widely used for retirement planning.
Zerodha believes the Indian mutual fund industry is gradually moving from product-based investing to goal-based investing.
Vishal Jain, CEO of Zerodha Fund House, said that the next phase of investing is likely to focus more on financial goals rather than individual investment products.
Minimum Investment Starts at Just ₹100
The new funds are designed around a fixed investment horizon, making them suitable for long-term goals.
They will be taxed in the same way as equity mutual funds and come with no lock-in period.
Investors can start with a minimum investment of just ₹100.
The New Fund Offer (NFO) for both schemes opened on June 19 and will remain open for investment until July 7.
