Lotus India plans long/short stock mutual fund

MUMBAI, May 9 (Reuters) - Lotus India Asset Management Co Pvt Ltd on Friday filed initial papers with the Securities and Exchange Board of India for a long/short equity fund.

Going long refers to buying and holding a security to sell at a higher price. Taking a short position means selling a security that one does not own, in hopes of repurchasing it at a lower price and making a profit from the price differential.

Lotus India Long Short Equity Fund will invest at least 65 percent of its assets in long positions and can take short positions in the range of 0-100 percent of its net assets, the firm said in its offer document.

The fund can also invest upto 35 percent of the assets in debt and money market instruments.

India's market regulator allowed short selling of shares by all institutional investors from April 21. (Reporting by Nishant Kumar; editing by Sunil Nair )