Motilal Oswal Asset Management Company has launched a new fund offer (NFO) named Motilal Oswal BSE Top 10 Banks ETF. The NFO opened for investment on April 6, 2026, and investors can apply till this evening.
The scheme is scheduled to be listed on the stock exchange on April 9, after which investors will be able to buy and sell its units daily like shares.
What is Special About This ETF?
This is an Exchange-Traded Fund (ETF) that tracks the BSE Top 10 Banks Total Return Index. The fund will invest in the top 10 banking stocks listed on the Bombay Stock Exchange.
It is a passively managed fund, which means the fund manager invests according to the index composition. This reduces the chances of human error and also keeps the cost lower compared to actively managed funds.
Portfolio Structure
The ETF gives investors exposure to some of the strongest banks from both private and public sectors.
Maximum weight of a single bank is capped at 33%
Combined weight of top 3 banks cannot exceed 63%
This structure ensures some level of balance within the banking-focused portfolio.
Why Invest in the Banking Sector?
Market experts believe that as India moves toward becoming a $5 trillion economy, the banking sector will play a crucial role.
Credit growth is expected to improve
Bank balance sheets are becoming stronger
Overall sector outlook remains positive
This ETF is suitable for investors who prefer investing in a basket of banking stocks instead of selecting individual shares.
Investment Terms and Costs
Minimum Investment: ₹5,000 during NFO, and ₹1 thereafter in multiples
Unit Price: ₹10 per unit during NFO
Lower Cost: ETFs generally have lower expense ratios than active mutual funds
Liquidity: After listing, units can be traded on the stock exchange like regular shares
Risk Factors
Since this is a sectoral/thematic fund, it falls under the “very high risk” category.
The performance of this ETF depends entirely on the banking sector. If the sector faces a downturn, the fund’s returns may be significantly affected due to limited diversification.
