HDFC Mutual Fund launches HDFC NIFTY500 Multicap 50:25:25 Index Fund NFO

Introduction

If you’re already a key player or new to the world of New Fund Offers (NFOs), you've come to the correct spot to learn about the latest trends, insights, and news influencing this dynamic market. We are today at HDFC NIFTY500 Multicap 50:25:25 Index Fund NFO Blog committed to giving you insightful knowledge, Financial attributes, past performance if any, etc. on this NFO. 

 

Everything You Need To Know About HDFC NIFTY500 Multicap 50:25:25 Index Fund NFO

HDFC Mutual Fund introduced the HDFC NIFTY500 Multicap 50:25:25 Index Fund which is an open-ended scheme replicating/tracking Nifty500 Multicap 50:25:25 Index. The lowest investment required to join is Rs.100 for investors and any amount thereafter. The Scheme’s investments will mostly be made in Securities included in the Nifty500 Multicap Index and Debt securities & money market instruments, mutual fund units of debt schemes. The Scheme is suitable for such investors who seek- 

• Returns that, over the long term and subject to tracking error, are consistent (before fees and expenditures) with the performance of the Nifty500 Multicap 50:25:25 Index.

• Investing in stocks that are part of the Nifty500 Multicap 50:25:25 Index.

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

 

 

HDFC NIFTY500 Multicap 50:25:25 Index Fund NFO Overview

The period for investments is open from August 6, 2024, to August 20, 2024. The scheme has an extremely high risk. The Scheme will allocate 95-100% of its investment capital to Securities included in the Nifty500 Multicap Index & 0-5% to Debt securities, money market instruments, and mutual fund units of debt schemes. There is no assurance that the Scheme's investment goal will be met. Since this Scheme is new, no past performance record is available. 

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Fund Overview

Start Date	06 August 2024
End Date	20 August 2024
Allotment Date / Subscription Date	Within 5 business days after the end date of the NFO
VRO Rating	-
Expense Ratio	NA
Exit Load	Nil.
AUM	Rs.607341.91 crores as of March 31, 2024.
Lock-In	NA
Stamp Duty	0.005% (From July 1st 2020)
Benchmark	Nifty500 Multicap 50:25:25 Index
Min. Investment	Rs.100 and any amount thereof
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 12.5% tax will be levied

 

How To Invest In The NFO After The Allotment Date?

If you have missed participating in the NFO and now want to invest in the same on a continuous basis, then within 5 working days after the closure date of the NFO; you will have the option to participate directly in the Mutual Fund by spending at NAV based prices; by logging on to your Demat Account or directly with the AMC and search for “HDFC NIFTY500 Multicap 50:25:25 Index Fund” or simply touch the “Banner” below.

 

 

The Objective of the Fund

The Fund Scheme's goal is to generate returns that match the performance of the Nifty500 Multicap 50:25:25 Index (before fees and expenses). Nevertheless, there can be no assurance that the investment goal of the Scheme will be achieved.

Asset allocation (% of Net Assets) of The Scheme's Portfolio Will Be As Follows:

Types of Instruments	Min Allocation (% of Net Assets)	Max Allocation (% of Net Assets)
Securities included in the Nifty500 Multicap Index	95	100
Debt securities, money market instruments, and mutual fund units of debt schemes	0	5

 

Peers of HDFC NIFTY500 Multicap 50:25:25 Index Fund

Scheme	1 Yr Return (%)	AUM (Cr)
Motilal Oswal Nifty 500 Index Fund	32.86	1525.15
HDFC BSE 500 Index Fund	32.19	156.3
Motilal Oswal S&P 500 Index	19.99	3391.09

 

Risk Factors in this Scheme

• Because the Scheme intends to invest at least 95% of net assets in the securities of the Underlying Index in the same ratio, it will not be actively managed.

• A widespread fall in the Indian markets with respect to its Underlying Index could have an impact on the Scheme.

• In order to achieve returns that are equal to the total returns represented by the Underlying Index, the Scheme will invest a minimum of 95% of its corpus in the securities that represent the Underlying Index.

• There will be minimal cash or debt/money market investments in the scheme. As a result, the Scheme is not very vulnerable to risks related to the debt or money markets.

 

Past Performance of Index Funds

Index Funds	NAV (Rs)	Annualized Return (1Y)	Return/Risk
Edelweiss Nifty Smallcap 250 Index Fund-Direct Plan-Growth	17.66	49.34%	Very High Risk
Nippon India Nifty Smallcap 250 Index Fund-Direct Plan-Growth	33.896	48.42%	Very High Risk
SBI Nifty Smallcap 250 Index Fund-Direct Plan-Growth	18.58	48.62%	Very High Risk

 

 

HDFC NIFTY500 Multicap 50:25:25 Index Fund NFO-Who Can Invest?

This fund is ideal for you if you are looking for returns that, over the long term and subject to tracking error, are consistent (before fees and expenditures) with the performance of the Nifty500 Multicap 50:25:25 Index and investing in equity securities that are part of the Nifty500 Multicap 50:25:25 Index.

 

HDFC NIFTY500 Multicap 50:25:25 Index Fund NFO-Growth Fund Managers

• Nirman Morakhia

• Arun Agarwal
  
  

Conclusion

A low-cost, diversified equities investment strategy with balanced exposure is provided by this Scheme. The Scheme comes under a very high risk category. There is no guarantee that the goals of this Scheme will be achieved. The Scheme is suitable for such investors who are looking for returns over the long term aligned with Nifty500 Index. The company has no previous performance record. Research well according to your objectives, and the time horizon of your investment. 

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.