NFO Alert: Axis Mutual Fund launches Axis Nifty Bank Index Fund; all you need to know

Axis Mutual Fund announced the launch of the Axis Nifty Bank Index Fund. The scheme opened for public subscription on May 03, 2024, and will close on May 17, 2024. 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 scheme replicating/tracking the Nifty Bank TRI. This product is suitable for investors seeking

• Long-term capital growth
• Investments in equity and equity-related securities and portfolios replicating the composition of the Nifty Bank TRI, subject to tracking errors.

What is the main objective of investing in this fund?

The investment objective of the scheme is to provide returns before expenses that correspond to the total returns of the Nifty Bank TRI subject to tracking errors. However, there can be no assurance or guarantee that the investment objective of the scheme will 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:

Are there similar mutual funds in the market?

To date, some mutual fund houses have launched similar funds, thus, allowing inclined investors to avail of returns corresponding to the total returns of the securities in this particular index. These include:

How will the scheme benchmark its performance?

Considering the investment in the scheme is made to achieve returns that commensurate with the performance of the Nifty Bank Index, we propose to have Nifty Bank TRI as the benchmark. The Total Return variant of the index (TRI) will be used for performance comparison. The Nifty Bank Index is designed to reflect the behaviour and performance of large and liquid banks. The index comprises a maximum of 12 stocks and the base date of the index is January 1, 2000.

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’ will be charged as

• If redeemed/ switched out within seven days from the date of allotment/ Investment – 0.25%
• if redeemed/ switched out after seven days from the date of allotment/ Investment - Nil

Who will manage this scheme?

Ashish Naik and Karthik Kumar are the dedicated fund managers of the Axis Nifty Bank Index Fund.

Does the fund contain any inherent risk?

The scheme involves “Very High Risk” as per the details mentioned in the Scheme Information Document and 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 is suitable for them.