NFO Alert: Kotak Mutual Fund Unveils Kotak MSCI India ETF

Kotak Mahindra Asset Management Company has introduced the Kotak MSCI India ETF, India’s first exchange-traded fund (ETF) tracking the MSCI India Index. The new fund offer (NFO) opened for public subscription on January 29, 2025, and will close on February 12, 2025. Continuous trading of the ETF is expected to begin on or before February 27, 2025.

Tracking the MSCI India Index

The ETF is to replicate the MSCI India Index (Total Return Index – TRI). This index includes 156 large- and mid-cap companies, covering about 85% of the Indian equity market. The scheme follows a passive investment strategy, meaning it will invest in stocks in the same proportion as the index.

Risk and Investment Strategy

The fund is classified under the very high-risk category, as mentioned in the Scheme Information Document (SID). To maintain alignment with the index, the fund managers will rebalance the portfolio based on changes in stock weights, as well as inflows and redemptions. The ETF aims to minimize tracking errors while following the index’s composition.

Fund Managers and Charges

The scheme is managed by Devender Singhal and Abhishek Bisen. The minimum application amount during the NFO is ₹5,000, with no restrictions on additional investments. The price per unit during the NFO is ₹10. The scheme has no entry or exit load, allowing investors to buy or sell units freely on the stock exchange after listing.

Listing and Trading

Once listed, units can be traded on the stock exchanges where they are listed. Investors, including retail participants and large investors, will be able to buy or sell units on all trading days.

Kotak International, the global arm of the Kotak Group, has launched a separate fund called the Kotak MSCI India ETF Fund. This will allow international investors to invest in the same benchmark.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.