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NFO alert: Nippon India Mutual Fund launches 2 new index funds; details inside

18 September 20246 mins read by Angel One
In the following article we shed light on the new NFOs, their objectives, fund allocation, fund managers and peer performance.
NFO alert: Nippon India Mutual Fund launches 2 new index funds; details inside
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Nippon India Mutual Fund has launched two new index funds: Nippon India Nifty Bank Index Fund and Nippon India Nifty IT Index Fund. Both funds aim to offer investment returns in line with their respective benchmark indices – the Nifty Bank Index and Nifty IT Index – before expenses. This means the funds will passively track the composition of these indices, providing diversified exposure to the banking and IT sectors respectively.

Both funds are open-ended with no entry or exit loads and require a minimum investment of Rs. 1,000. The New Fund Offer (NFO) for both funds is open from February 5th to February 16th, 2024. Remember, investing in any mutual fund involves market risk, and past performance is not indicative of future results.

Investment objective

Nippon India Nifty Bank Index Fund The investment objective of the scheme is to provide investment returns that are commensurate to the total returns of the securities as represented by the Nifty Bank Index before expenses, subject to tracking errors.
Nippon India Nifty IT Index Fund The investment objective of the scheme is to provide investment returns that commensurate to the total returns of the securities as represented by the Nifty IT Index before expenses, subject to tracking errors.

Funds Allocation

Nippon India Nifty Bank Index Fund

Asset Class Minimum (%) Maximum (%) Risk Profile
Securities constituting Nifty Bank Index 95 100 Very High
Cash & cash equivalents and Money Market instruments, Reverse repo and/or Tri-Party Repo on Government securities or Treasury bills and/or units of money market / liquid schemes 0 5 Low to Medium

Nippon India Nifty IT Index Fund

Asset Class Minimum (%) Maximum (%) Risk Profile
Securities constituting Nifty IT Index 95 100 Very High
Cash & cash equivalents and Money Market instruments, Reverse repo and/or Tri-Party Repo on Government securities or Treasury bills and/or units of money market / liquid schemes 0 5 Low to Medium

Cash Equivalents include Government Securities, T-Bills and Repo on Government Securities having residual maturity of less than 91 days. The Scheme may invest up to 5% of net assets in money market/liquid schemes without charging any fees.

Benchmark

Nippon India Nifty Bank Index Fund – Nifty Bank TRI

Considering the investment in the scheme is made to achieve a return commensurate with the performance of the Nifty Bank Index, the mutual fund house proposes to have Nifty Bank TRI as the benchmark. Total Return variant of the index (TRI) will be used for performance comparison.

Nippon India Nifty IT Index Fund – Nifty IT TRI

Considering the investment in the scheme is made to achieve a return commensurate with the performance of the Nifty IT Index, mutual fund house proposes to have Nifty IT TRI as the benchmark. Total Return variant of the index (TRI) will be used for performance comparison.

Fund managers

Himanshu Mange: Fund Manager & Dealer – ETF ( Managing the Scheme – Since Launch of the scheme), Age: 30 years, Educational Qualification: Chartered Accountant and over 4 years of experience

Peer Schemes

Nippon India Nifty Bank Index Fund

Particulars Motilal Oswal Nifty Bank Index Dir Navi Nifty Bank Index Dir Nippon India ETF Nifty Bank BeES Kotak Nifty Bank ETF SBI Nifty Bank ETF
Net Asset (Rs Cr) 514 471 6,248 4,723 4,663
Return Since Launch 11.95 8.05 16.37 10.45 10.97
Risk-o-meter Very High Very High Very High Very High Very High
Exit Load (Days) 1.00 (15)
Expense Ratio (%) 0.33 0.1 0.19 0.16 0.2
Fund Age 4Y 5M 2Y 19Y 8M 9Y 2M 8Y 10M
Portfolio Turnover (%) 22 19 31 28.47 23
Returns Motilal Oswal Nifty Bank Index Navi Nifty Bank Index Nippon India ETF Nifty Bank BeES Kotak Nifty Bank ETF SBI Nifty Bank ETF
YTD -6.81 -6.82 -6.81 -6.81 -6.81
1 Day -1.76 -1.77 -1.76 -1.76 -1.76
1 Week -2.55 -2.56 -2.55 -2.55 -2.55
1 Month -5.15 -5.16 -5.15 -5.15 -5.15
3 Months 3.03 3.05 3.06 3.06 3.06
6 Months 0.2 0.21 0.27 0.26 0.26
1 Year 8.97 8.81 9.13 9.05 9.11
2 Years 9.42 9.26 9.49 9.41 9.48
3 Years 8.14 8.26 8.19 8.26
5 Years 10.55 10.49 10.57
7 Years 12.22 12.17 12.23
10 Years 16.18

Nippon India Nifty IT Index Fund 

Particulars ICICI Pru Nifty IT Index Nippon India ETF Nifty IT ICICI Pru Nifty IT ETF ICICI Pru Technology Tata Digital Ind Reg
Net Asset(Rs Cr) 344 1,972 431 11,874 9,272
Return Since Launch (%) 17.88 31.17 25.31 12.87 19.97
Riskometer Very High Very High Very High Very High Very High
Exit Load (Days) 1.00 (15) 0.25 (30)
Expense Ratio (%) 0.95 0.22 0.2 1.74 1.69
Fund Age 1Y 5M 3Y 7M 3Y 5M 23Y 11M 8Y 1M
Portfolio Turnover (%) 30 45 50 61 25.5
Returns ICICI Pru Nifty IT Index Nippon India ETF Nifty IT ICICI Pru Nifty IT ETF ICICI Pru Technology Tata Digital Ind Reg
YTD 6.77 6.87 6.87 6.72 6.22
1 Day 0.22 0.22 0.22 -0.79 -0.95
1 Week 3.59 3.61 3.61 2.19 2.34
1 Month 9.89 9.97 9.97 7.65 7.39
3 Months 22.45 22.71 22.74 20.27 21.24
6 Months 23.3 23.82 23.85 23.64 24.62
1 Year 24.17 25.1 25.11 30.52 33.8
2 Years 6.56 6.61 7.69 9.08
3 Years 15.36 15.35 20.35 21.22
5 Years 23.86 23.17
7 Years 24.8 25.25
10 Years 19.15

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.

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