As more Indians invest abroad, MFs to line up international funds
Around six mutual fund houses are seeking Sebi’s permission to offer nine international schemes. The fund houses include Mirae Asset Mutual Fund, Mahindra Manulife Mutual Fund, Nippon India Mutual Fund, Kotak Mahindra Mutual Fund, HSBC Mutual Fund and BNP Paribas Mutual Fund.
The number of Indians investing abroad is on the rise. To benefit from the trend, mutual fund houses plan to launch schemes that enable domestic investors to invest abroad.
Around six mutual fund houses are seeking Sebi’s permission to offer nine international schemes. The fund houses include Mirae Asset Mutual Fund, Mahindra Manulife Mutual Fund, Nippon India Mutual Fund, Kotak Mahindra Mutual Fund, HSBC Mutual Fund and BNP Paribas Mutual Fund.
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There are a variety of funds that would be on offer allowing investors to take exposure to FANG+ index – highly-traded growth stocks of technology and tech-enabled companies, European companies, Asia Pacific REITs, businesses that would benefit from the growing imbalance between water supply and demand, and companies that could benefit from the transition to a low carbon economy.
Investing abroad had its benefits. It makes sense to invest in stocks of a country where you may be looking at emigrating or sending your child for further studies. Such investments will cover you from currency fluctuations.
It also offers diversification. For example, there could be periods when Indian stock markets may not do well. But the US market may offer good returns. Such diversification, however, is suited for large portfolios.
Most advisors also suggest that investors should stick to developed market like the US for geographic diversification unless the investor had an advisor to guide them.
If you have just started and your portfolio is small, you must stick to Indian equities. If you want a flavour of international equities, you can look at funds like Parag Parikh Flexi Cap Fund that invest some portion in the international stocks.
Here’s a list of schemes that mutual fund houses plan to launch.
1. Mirae Asset Global NextGen Tech Fund of Fund
An open-ended fund of fund scheme predominantly investing in equity exchange-traded funds listed in the US.
Benchmark: NASDAQ 100 Total Return Index
2. Mirae Asset US FANG Plus ETF
An open-ended scheme replicating/tracking NYSE FANG+ Total Return Index.
Benchmark: NYSE FANG+ Total Return Index
3. Mahindra Manulife Asia Pacific REITs Fund
An open-ended fund of fund scheme investing in Manulife Global Fund’s Asia Pacific REIT Fund.
Benchmark: Manulife Investment Asia REIT Ex Japan Index
4. Nippon India S&P Europe 350 Index Fund
An open-ended scheme replicating/tracking S&P Europe 350 Index.
Benchmark: S&P Europe 350 Total Return Index
5. Nippon India NASDAQ 100 Index Fund
An open-ended scheme replicating/tracking NASDAQ 100 Index.
Benchmark: NASDAQ 100 Total Return Index
6. Kotak Global Innovation Fund of Fund
An open-ended fund of fund investing in units of Wellington Global Innovation Fund or any other similar fund/ETFs.
Benchmark: MSCI All Country World Index Total Return Index
7. Kotak NASDAQ 100 Fund of Fund
An open-ended fund of fund investing in units of overseas ETF’s and/or Index Fund based on NASDAQ 100 Index.
Benchmark: NASDAQ-100 Index Total Return Index
8. HSBC Global Equity Climate Change Fund
An open-ended fund of fund scheme investing in HSBC Global Investment Funds’ Global Equity Climate Change Fund.
Benchmark: MSCI AC World Total Return Index
9. BNP Paribas Aqua Fund of Fund
An open-ended fund of fund scheme investing in BNP Paribas Aqua (Lux)
Benchmark: MSCI World Index Total Return Index
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