Kotak Nifty Smallcap 250 Index Fund NFO 2025

Kotak Nifty Smallcap 250 Index Fund: Overview

Kotak Mahindra Mutual Funds introduces the Kotak Nifty Smallcap 250 Index Fund on 06 January 2025. Under Kotak Mahindra Asset Management Company (Kotak MAMC) price is set at Rs.100 and any amount thereafter. This new fund offer is available for subscription from January 06, 2025, to 20 January 2025. This open-ended scheme will track the Nifty Smallcap 250 Index. 

This mutual fund scheme reopens for sale and repurchases on or before 30 January 2025 and carries a very high risk.

 

Fund Objective

The scheme has an investment objective of providing returns before expenses in a manner that corresponds to the total returns of the securities underlying the index, subject to tracking errors.

For more information about this new NFO Mutual Fund keep reading.

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Fund Overview

Portfolio Construction: 

• Companies must be a component of the Nifty 500 in order to be eligible for inclusion in the Nifty Smallcap 250 index; they cannot be a part of the Nifty 100 or Nifty Midcap 150.
  
  

Nifty Smallcap 250 Index 

The remaining 250 companies (those ranked 251-500) from the Nifty 500 are represented by the Nifty Smallcap 250 Index. The goal of this index is to evaluate the performance of companies with small market capitalizations.

Kotak Nifty Smallcap 250 Index: Brief Overview

Kotak Nifty Smallcap 250 Index Fund Minimum SIP

The minimum SIP amount for this fund is Rs.100.

 

Scheme Plan: 

Kotak Nifty Smallcap 250 Index Fund-Direct

Kotak Nifty Smallcap 250 Index Fund-Regular

Kotak Mahindra Mutual Fund Details

• AUM of Rs.4,92,719 crore as of 31 Dec 2024.

• Was established in 1985 by Uday Kotak.

• A total of 70 Schemes are currently running by the end of 31 Dec 2024.

 

How to Invest in the Scheme After the Closure of the NFO?

If you have missed participating in the NFO and now want to invest in the same Scheme on a continuous basis, then on 30 January 2025, when the Scheme will reopen; 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 “Kotak Nifty Smallcap 250 Index Fund” or directly with the AMC or simply click the ‘Banner’ below.

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

Peers of Kotak Nifty Smallcap 250 Index Fund

Explore the best small cap mutual funds.

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

 

Risk Factors in Such Funds

• Risk tracking errors: Returns from the scheme may not match those of the Nifty Smallcap 250 Index because of cost efficiencies that result from tracking errors such as transaction costs, fund flows, or market conditions.

• Market Risk: The NAV of the scheme will be very much dependent upon the performance of the benchmark index, given that it is going to be affected by market fluctuations, interest rates, developments in the macro economy, or political conditions.

• Passive Management Risk: Losses caused by market dips are likely to be experienced by the scheme, which is an index fund passively managed. The scheme holds index constituents without consideration of the individual stocks merits; thus it might realize losses if the market goes down.

• Liquidity Risk: In such case, the scheme's performance will be adversely affected, either in submitting a redemption request or availing an investment opportunity because of market conditions, which inhibit buying or selling the securities that comprise that index.

• Concentration Risk: these sudden rearrangements that the scheme experiences, as the scheme replicates the Nifty Smallcap 250 Index, from a change in the composition of an index, such as the addition of stocks, deletion from the index, or both.
  
  

Past Performance of Smallcap Funds

 

Kotak Nifty Smallcap 250 Index Fund-Fund Managers

• Mr. Devender Singhal

• Mr. Satish Dondapati 

• Mr. Abhishek Bisen.
  
  

Conclusion

With a low minimum investment and no exit load, this fund offers accessibility and flexibility. The Kotak Nifty Smallcap 250 Index Fund is an option for investors who seek exposure to small-cap companies through a passive investment strategy. However, carrying a high-risk fund is suitable for those with a high-risk appetite and a long-term investment horizon. 

Disclaimer: Not a buy or sell recommendation. No investment advice is given. Future returns are not guaranteed by past returns. This NFO analysis is provided solely for informative purposes and should not be considered investment advice. Always conduct research and talk with a financial advisor before investing.