Kotak Consumption Fund
Kotak Consumption Fund is an open-ended equity scheme following a consumption theme. The new offer or the NFO of the scheme is open for subscription and it will close on November 8.
The scheme will be benchmarked against Nifty India Consumption TRI. The scheme will be managed by Devender Singhal, Abhishek Bisen, and Arjun Khanna.
The investment objective of the scheme is to generate long-term capital appreciation from a portfolio that is invested predominantly in equity and equity related securities of companies engaged in consumption and consumption related activities. The minimum application amount will be Rs 5,000 and in multiples of Re 1 for purchases and of Re 0.01 for switches.
The scheme will invest 80-100% in equity and equity related securities of companies engaged in consumption and consumption related activities, 0-20% in equity and equity related securities of companies other than those engaged in consumption and consumption related activities, 0-20% in overseas mutual funds schemes / ETFs / foreign securities, 0-20% in debt and money market securities, and 0-10% in units of REITs & InvITs .
Bajaj Finserv Banking and PSU Fund
Bajaj Finserv Banking and PSU Fund is an open-ended debt scheme predominantly investing in debt instruments of banks, public sector undertakings, public financial institutions and municipal bonds with relatively high interest rate risk and moderate credit risk. The new fund offer or the NFO of the scheme is open for subscription and will close on November 6.The scheme will be benchmarked against NIFTY Banking & PSU Debt Index. The scheme will be managed by Siddharth Chaudhary, Nimesh Chandan.
The investment objective of the scheme is to generate income by predominantly investing in debt and money market securities issued by Banks, Public Sector Undertaking (PSUs), Public Financial Institutions (PFI), Municipal Bonds and reverse repos in such securities, sovereign securities issued by the Central Government and State Governments, and / or any security unconditionally guaranteed by the Govt. of India.
Bandhan Nifty Alpha 50 Index Fund
Bandhan Nifty Alpha 50 Index Fund is an open-ended scheme tracking Nifty Alpha 50 Index. The new fund offer or the NFO of the scheme is open for subscription and will close on November 6.
The scheme will be benchmarked against Nifty Alpha 50 TRI. The scheme will be managed by Nemish Sheth.
The investment objective of the scheme is to replicate the Nifty Alpha 50 Index by investing in securities of the Nifty Alpha 50 Index in the same proportion / weightage with an aim to provide returns before expenses that tracks the total return of Nifty Alpha 50 Index, subject to tracking errors.
The minimum application amount will be Rs 1000 and in multiples of Re 1 thereafter. The minimum application amount for SIP will be Rs 100 and in multiples of Re 1 thereafter with minimum six instalments.
Should you invest?
Should you invest in these NFOs? We typically ask investors to avoid investing in NFOs unless they offer something unique. The uniqueness could be that the scheme is offering an investment option that is not available in the market or offering something extra to an existing option. Otherwise, we believe investors are better off with an existing scheme with a long performance record. This is because you have some historical data to base your investment decision. You don’t have any data when it comes to new offerings.
There are around 13 schemes based on consumption theme. Around 12 schemes have a performance record of three years. These 12 schemes have offered around 24.14% average return in three years. We do not recommend thematic schemes to individual investors with moderate corpus. Thematic schemes can be used by experienced investors with large corpus to diversity. However, an existing scheme with a proven track record would be a better bet.
There are around 22 schemes in the banking and PSU fund category. Around 18 schemes have a performance record of three years. These 18 schemes have offered an average return of 4.39% in three years. These schemes are useful for investors to park money in relatively safe debt funds. Here are our recommendations: Best Banking & PSU mutual funds to invest in 2023
Bandhan Nifty Alpha 50 Index Fund is benchmarked against Nifty Alpha 50 TRI. It is the only scheme benchmarked against this index. However, there is an existing ETF scheme in this category – Kotak Nifty Alpha 50 ETF – which was launched in December 2021. As you can see, you don’t have much data to fall back on.
