NFO Alert: Kotak Mutual Fund Launches Nifty Commodities Index Fund

Kotak Mahindra Mutual Fund is launching the Kotak Nifty Commodities Index Fund, an open-ended index fund that tracks the Nifty Commodities Index. The fund will be available for subscription from February 17, 2025, to March 3, 2025.

Investment Objective

The fund aims to provide returns that align with the Nifty Commodities Index, subject to tracking errors. It follows a passive investment strategy, meaning it will invest in the stocks constituting the index in approximately the same proportions.

Fund Details

• Category: Equity – Index Fund
• Scheme Type: Open-ended
• Benchmark: Nifty Commodities Index (Total Return Index – TRI)
• Risk Level: Very High
• Fund Manager: Devender Singhal
• Minimum Investment: ₹100 and any amount thereafter
• Incremental Investment: ₹100
• Exit Load: NIL
• NAV Calculation: Daily

The fund will primarily invest in:

• 95-100% in equity and equity-related securities from the Nifty Commodities Index.
• 0-5% in debt and money market instruments for liquidity purposes.

Benchmark & Composition

The Nifty Commodities Index includes 30 companies from sectors such as oil, cement, power, metals, and chemicals. The index is designed to track companies with commodity-linked businesses.

Units of the fund can be subscribed and redeemed at NAV-based prices on any business day. The scheme will not be listed on any exchange since it is open-ended.

Risks

• Market Risk: Returns depend on the movement of the Nifty Commodities Index.
• Tracking Error: There may be deviations between fund performance and the index due to expenses and liquidity issues.
• Sectoral Volatility: Commodities-based businesses are affected by price fluctuations, economic conditions, and global trade policies.

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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 in the securities market are subject to market risks, read all the related documents carefully before investing.