Motilal Oswal Nifty Microcap 250 Index Fund announced the launch of the Motilal Oswal Nifty Microcap 250 Index Fund, an open-ended fund replicating/tracking the Nifty Microcap 250 Total Return Index.
The scheme opened for public subscription on June 15, 2023, and will close on June 29, 2023. The scheme re-opens for continuous sale and repurchase within five business days from the date of allotment.
What kind of mutual fund scheme is this?
This is an open-ended fund replicating/tracking the Nifty Microcap 250 Total Return Index.
Navin Agarwal, MD & CEO, Motilal Oswal Asset Management Company said, “We have been pioneering in many passive funds in India. Our latest microcap-based index fund offering will further expand our wide range of passive funds. By launching the Motilal Oswal Nifty Microcap 250 Index Fund, we offer investors a natural extension of the Motilal Oswal Nifty 500 Index Fund, complementing our existing range of broad-based index funds.”
What is the main objective of investing in this fund?
The investment objective of the scheme is to provide returns that, before expenses, correspond to the total returns of the securities as represented by the Nifty Microcap 250 Total Return Index, subject to tracking error. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved.
How may one invest in this scheme?
Investors can invest under the scheme with a minimum investment of ₹500 per plan/option and in multiples of Re 1. There is no upper limit for investment.
Under normal circumstances, the asset allocation of the scheme will be as follows:
Instruments | Indicative allocations (% of total assets) | Risk Profile | |
Minimum | Maximum | ||
Constituents of the Nifty Microcap 250 Index | 95% | 100% | Very High |
Units of liquid schemes and/or money market instruments | 0% | 5% | Low |
Are there similar mutual funds in the market?
To date, no asset management company (AMC) has launched such a fund, thus, making Motilal Oswal Mutual Fund India’s first mutual fund house to launch a fund in the Nifty Microcap 250 Index category.
Pratik Oswal, Head of Passive Funds, Motilal Oswal Asset Management Company said, “With the Motilal Oswal Nifty Microcap 250 Index Fund, we lead the charge in unlocking the untapped potential and opportunities of this distinctive investment category. We believe that the segment holds immense potential and unique investment opportunities that have been overlooked by many in the industry.”
How will the scheme benchmark its performance?
The performance of the scheme will be benchmarked against Nifty Microcap 250 Total Return Index. As the Scheme is an Index Scheme and Nifty Microcap 250 Total Return Index is the ideal benchmark for this scheme, the investment objective of the scheme is replicate/track the performance of the index. The Total Return variant of the index (TRI) will be used for performance comparison.
Are there any entry or exit loads to this scheme?
This scheme involves no “Entry Load”, which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load” would be charged as per the following:
- 1% if redeemed on or before 15 days from the date of allotment.
- Nil- If redeemed after 15 days from the date of allotment.
Who will manage this scheme?
The fund will be managed by Swapnil Mayekar.
Does the fund contain any inherent risk?
The scheme involves “Very High Risk” as per the details mentioned in the Scheme Information Document. It is best suited to investors willing to understand that their principal will be subject to very high risk only. However, investors should consult their financial advisors if they doubt whether the product suits them.
