Motilal Oswal Mutual Fund has announced the launch of two factor-based funds, i.e. Motilal Oswal S&P BSE Quality ETF & Motilal Oswal S&P BSE Quality Index Fund and Motilal Oswal S&P BSE Enhanced Value ETF & Motilal Oswal S&P BSE Enhanced Value Index Fund. The new fund offer (NFO) will open on 29 July and close on 12 August 2022.
The Motilal Oswal S&P BSE Quality ETF & Index Fund are single factor-based investment strategies that aim to include the top 30 ‘Quality’ stocks based on rule-based parameters, the mutual fund house said in a release.
“These companies tend to have durable business models and sustainable competitive advantages. The index constituents are selected from the universe of the S&P BSE LargeMidCap Index. The Quality stocks are identified based on companies with high earnings, a better quality of earnings and lower debt. Over a long time horizon, it has been observed that such high-quality stocks tend to outperform low-quality stocks, as they are better equipped to weather adverse economic conditions,” Motilal Oswal AMC added.
On the other hand, the Motilal Oswal S&P BSE Enhanced, Value ETF & Index Fund are single factor-based investment strategies that aim to include 30 ‘Value’ stocks that are most attractive in valuations based on rule-based parameters.
The index constituents are selected from the universe of the S&P BSE LargeMidCap Index. The Value stocks are identified based on low Price to Earnings, Price to Book and Price to Sales ratios, the company said in the release.
“With an objective to cater the evolving needs of the investors, we have introduced ETFs & index funds in the factor investing segment. These new funds are based on the Quality and Value factors. We aspire to build a unique brand positing by establishing ourselves as a fund house to drive the factor investing category in India. With the launch of both these funds, it will complete our bouquet of single-factor based passive offerings”, said Navin Agarwal, MD & CEO, Motilal Oswal Asset Management Company (AMC) Ltd.