Upcoming NFO: HDFC Mutual Fund Files Draft for Nifty LargeMidcap250 Plus 8-13 yr G-Sec 70:30 Index Fund

HDFC Mutual Fund has filed a draft Scheme Information Document for the HDFC Nifty LargeMidcap250 Plus 8-13 yr G-Sec 70:30 Index Fund. The proposed scheme has been categorised as an equity-oriented hybrid index fund. 

The fund will track the Nifty LargeMidcap250 Plus 8-13 yr G-Sec 70:30 Index (TRI). Its stated objective is to replicate the composition of the index through investments in equity, equity-related, and debt securities, subject to tracking error. 

How the Fund Will Invest 

According to the draft, between 95% and 100% of the scheme's total assets may be invested in constituents of the LargeMidcap250 Plus 8-13 yr G-Sec 70:30 Index. 

The remaining 0% to 5% may be invested in plain vanilla debt securities, government securities, Treasury Bills, money market instruments, repo on government securities, and units of liquid and overnight mutual fund schemes. 

The scheme may also take exposure to equity derivatives of underlying index securities, up to 20% of net assets, where a security is unavailable or for portfolio rebalancing. Stock and index futures may be used mainly for rebalancing purposes. 

Plans and Investment Details 

The proposed scheme will offer Regular and Direct Plans. Both plans will have Growth and Income Distribution cum Capital Withdrawal, or IDCW, options. Growth will be the default option, while reinvestment will be the default facility under IDCW. 

The minimum application amount during the New Fund Offer, as well as after the scheme opens for regular transactions, will be ₹100. Additional purchases can also be made from ₹100, while the minimum redemption or switch-out amount will be ₹100. 

NFO Dates Yet to Be Announced 

The draft does not mention the opening or closing dates of the New Fund Offer (NFO). Units will be offered at ₹10 each during the NFO. The scheme is expected to reopen for continuous sale and repurchase within five working days of unit allotment. 

No entry load or exit load is proposed. Tracking error, tracking difference, and the actual total expense ratio are currently not available as the scheme is new. 

Read More: NFO Alert: ICICI Prudential Mutual Fund Launches ICICI Pru Dynamic Asset Allocation Passive FoF! 

Conclusion 

The draft filing outlines the proposed investment structure, plans, and transaction terms for the new index fund. Details such as the NFO dates are yet to be specified. 

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.