NFO Alert: Bandhan Nifty Bank Index Fund NFO Review & NAV

Bandhan Nifty Bank Index Fund: Key Details you need to Know

Bandhan AMC Limited by its Fund House Bandhan Mutual Fund launches “Bandhan Nifty Bank Index Fund”. It is an open-ended equity scheme that tracks the Nifty Bank Index. The NFO date is from August 08 to August 22, 2024, with an NFO price of Rs.1000 having an Exit Load of 0.25% if units are redeemed within 15 days.

To learn about the Fund's asset allocation, and other financial characteristics that influence decision-making, carefully read this blog.

Bandhan Nifty Bank Index Fund NFO Details

The scheme is suitable for investors who want to achieve capital appreciation over a long time and seeking to invest in Equity and equity-related instruments based on Nifty Bank Index. The scheme is a very high-risk scheme. There is no assurance that the scheme's investment goal will be met.

The scheme will invest 95-100% of its units in Securities belonging to the Nifty Bank Index (with Stock and Index derivatives) and 0-5% in Mutual Funds & debt and money market instruments.

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Fund Overview

The minimum subscription amount is set at Rs.1000 and in multiple of Rs.1 thereafter.

Start Date	08 August 2024
End Date	22 August 2024
Allotment Date / Subscription Date	28 August 2024
VRO rating	-
Expense ratio	Nil
Exit load	0.25% if redeemed within 15 days
AUM	Rs.148,741.98 Cr (as of 30 Jun 2024)
Lock-in	NA
Stamp Duty	0.005% (From July 1st 2020)
Benchmark	Nifty Bank Index.
Min. Investment	Rs.1000 and in multiple of Rs.1 thereafter
Risk	Very High
Short-term capital gains (STCG)	For less than 2 years, as per Tax Slab.
Long-term capital gains (LTCG)	For more than 2 years, a 12.50% Tax is applicable.

 

How To Invest In The NFO After The Closure Date?

If you have missed participating in the NFO and now want to invest in the same Scheme on a continuous basis, then on 28 August 2024 you will have the option to participate and invest directly in the Mutual Fund by spending at NAV based price by logging on to your Demat account and search for “Bandhan Nifty Bank Index Fund” or directly with the AMC or simply by clicking the ‘banner’ below

 

 

The Objective of the Fund

The Scheme intends to invest in Nifty Bank Index securities in the same proportion and weighting to replicate the Nifty Bank Index and, subject to tracking errors, provide returns before expenditures that follow the Nifty Bank Index's total return. Nevertheless, there can be no assurance or guarantee that the scheme's investment goals will be met.

Asset allocation (% of Net Assets) of the Scheme's portfolio will be as follows:

Types of Instruments	Minimum Allocation (% of Net Assets)	Maximum Allocation (% of Net Assets)
Securities belonging to the Nifty Bank Index (with Stock and Index derivatives)	95	100
Mutual Funds & debt and money market instruments	0	5

 

Peers of Bandhan Nifty Bank Index Fund

Scheme	1Y Return	AUM (Rs.)
Nippon India Nifty Bank Index Fund Regular Growth	-	124.34 Cr.
Motilal Oswal Nifty Bank Index Fund-Regular Plan-Growth	11.37%	66,452.27 Cr.
Navi Nifty Bank Index Fund Regular - Growth	14.04%	580.71 Cr.

Since this scheme is a new scheme, hence no comparable data on its past performance against its peers is available.

 

Risk Factors in Such Funds

• The Scheme's NAV will change in response to stock market fluctuations. The Investor could lose capital over a short or long period of time due to fluctuations in the Scheme's NAV as a result of variables such as company performance.

• The goal of the Nifty Bank Index is to monitor the success of big, liquid banks. There are a maximum of 12 stocks in the index. Investing in these companies would expose investors to market and sector-specific risks, as well as the possibility of a correction or consolidation period.

• Investments in REITs and InvITs may be subject to reinvestment risk since the Trusts may repatriate cash in the form of unit buybacks or IDCW payouts, among other things. As a result, the profits may be invested in assets that provide lesser yields.

• The investment in the scheme could increase or decrease based on a variety of variables and pressures affecting the debt and capital markets, as well as changes in the interest rate, price, and value of the securities in which the scheme invests.

 

Past Performance of Index Funds

Index Funds	NAV (Rs.)	Annualised Return	Return / Risk
Tata Nifty 50 Index Direct	161.18	23.84%	Very High Risk
Aditya Birla Sun Life Nifty 50 Index Fund Direct-Growth	246.99	23.96%	Performing Poorly
Franklin India NSE Nifty 50 Index Direct-Growth	202.09	123.69%	Produces 20% more returns for every Unit.

 

Bandhan Nifty Bank Index Fund NFO - Who Can Invest?

This Fund is ideal for those who want to achieve capital appreciation over a long time and seeking to invest in Equity and equity-related instruments based on Nifty Bank Index.

 

Bandhan Nifty Bank Index Fund NFO-Growth Fund Managers

• Mr. Nemish Sheth
  
  

Conclusion

The Scheme has a very high risk. The Schemes has no previous performance record. It is for investors who want to achieve capital appreciation over a long time and seeking to invest in Equity and equity-related instruments based on Nifty Bank Index. Always assess your Financial Goals, Risk tolerance, time horizon, etc. before making an investment decision. 

Disclaimer: This NFO analysis is provided solely for informative reasons and should not be construed as investment advice. Always conduct research and talk with a financial advisor before investing.