ICICI Prudential Mutual Fund unveils two passive funds: Check details

Both offerings fall under the smart beta category, focusing on a factor-based strategy to provide investors with a low-cost, value-driven investment approach

ICICI Prudential Mutual Fund on Monday launched two new investment products aimed at value-conscious investors: the ICICI Prudential Nifty200 Value 30 ETF and the ICICI Prudential Nifty200 Value 30 Index Fund. The new offerings will be open for subscription from September 30 to October 14, 2024.

 

These new funds fall under the smart beta category, employing a factor-based strategy to provide investors with a low-cost, value-driven investment approach. Both the Exchange Traded Fund (ETF) and the Index Fund will track the Nifty200 Value 30 Index, which comprises 30 stocks selected from the Nifty 200 Index based on a 'Value Score'. 

 

Historical data suggests that the Nifty 200 Value 30 Total Return Index (TRI) has outperformed the broader Nifty 200 TRI in six out of the last ten years. As of August 30, 2024, the index had significant exposure to sectors such as financial services, oil, gas & consumable fuels, metals & mining, and power, among others. The index undergoes rebalancing twice a year to align with market trends and valuation principles.

 

“At a time when investors are seeking diversified strategies for long-term growth, value investing remains a crucial component of a well-rounded portfolio. We are excited to introduce the Nifty200 Value 30 ETF and Index Fund, offering investors a targeted approach to value-based investing, which is designed to provide growth over the long term,” said Chintan Haria, Principal – Investment Strategy at ICICI Prudential AMC.

 

Details of ICICI Prudential Nifty200 Value 30 ETF

 

Objective of scheme: The investment objective of the scheme is to provide returns before expenses that closely correspond to the total return of the underlying index subject to tracking errors. However, there can be no assurance or guarantee that the investment objective of the scheme will be achieved.

 

Scheme type: The scheme is open-ended.

 

Scheme category: Other scheme - Other ETFs

 

New fund launch date: September 30, 2024

 

Minimum investment: Investors can participate with as little as ~100 during the new fund offer (NFO) period, with additional investments in multiples of ~1.

 

Exit load: Nil

 

Details of ICICI Prudential Nifty200 Value 30 Index Fund

 

Objective of scheme: The objective of the scheme is to invest in companies whose securities are included in the Nifty200 Value 30 Index and subject to tracking errors, to endeavour to achieve the returns of the above index. This would be done by investing in all the stocks comprising the Nifty200 Value 30 Index in the same weighting that they represent in the Nifty200 Value 30 Index. However, there is no assurance or guarantee that the investment objective of the scheme shall be achieved.

 

Scheme Type: Open Ended

 

Scheme Category: Other scheme - Index Funds

 

New Fund Launch Date: September 30, 2024

 

Minimum investment: Investors can participate with as little as ~100 during the NFO period, with additional investments in multiples of ~1.

 

Exit load: Nil

 

The schemes are well poised to adjust to prevailing circumstances in the market. For example, the index composition was overweight on financial services in 2023 and 2024 since the value score of the sector's stocks was higher. The midcap stocks had more value in 2022, but in 2019, the exposure to midcap stocks was the least in the last five years.

 

Note: It is advisable to consult with a financial advisor to determine if these products align with individual investment goals and risk tolerance before investing.