SBI Mutual Fund has announced the launch of two equity index funds, further expanding its offerings in the passive segment. SBI Nifty Midcap 150 Index Fund and SBI Nifty Smallcap 250 Index Fund are open-ended schemes that would replicate the performance of the underlying indices – Nifty Midcap 150 Index and Nifty Smallcap 250 Index, respectively.
The fund manager for the SBI Nifty Midcap 150 Index Fund and SBI Nifty Smallcap 250 Index Fund would be Harsh Sethi, who also manages other exchange-traded funds at the fund house.
According to the press release, the investment objective of the scheme is to provide returns that closely correspond to the total returns of the securities as represented by the underlying index, subject to tracking error. The fund house says that the new scheme would be suitable for investors who are seeking long-term capital appreciation, through investments in securities covered by the Nifty Midcap 150 Index and the Nifty Smallcap 250 Index and gain access to the potential growth of the companies in the underlying indices.
“As a fund house, we continue to expand our bouquet of offerings in the passive investment space. Mid and Small cap Index Funds provide a gateway to investors looking to tap into the growth potential of these emerging businesses as they move up the market capitalisation curve from being small caps to mid-caps and eventually large caps. Investors, especially first-time equity investors, can consider investing in these two funds in line with their risk profile for their long-term wealth creation goals.” D P Singh, Deputy MD & Chief Business Officer, SBI Mutual Fund.
The minimum application amount required for both the funds is Rs 5,000 and in multiples of Rs 1 thereafter. Investments can also be done through daily, weekly, monthly, quarterly, semi-annual, and annual SIP. The scheme would invest a minimum of 95% and a maximum of 100% of its assets in securities covered by the underlying indices – Nifty Midcap 150 Index and the Nifty Smallcap 250 Index, with up to 5% in money market instruments and units of a liquid mutual fund. The benchmarks for these funds are Nifty Midcap 150 TRI and Nifty Smallcap 250 TRI, respectively.