Nippon India Mutual Fund has launched two new index funds: the Nippon India Nifty 500 Low Volatility 50 Index Fund and the Nippon India Nifty 500 Quality 50 Index Fund.
These funds are now open for subscription from April 16, 2025, to April 30, 2025.
They are designed for long-term equity investors who want to reduce risk and expenses while still achieving good returns.
Both funds are managed by Jitendra Tolani. Let’s explore each of these funds in detail, including their investment strategies and suitability for different types of investors.
Nippon India Nifty 500 Low Volatility 50 Index Fund
This fund is designed for investors who want to focus on stocks with lower volatility.
It tracks the Nifty 500 Low Volatility 50 TRI Index, which selects the 50 least volatile stocks from the Nifty 500 index.
As a result, the fund aims to have lower volatility than the broader market.
Key Features
Category: Open-Ended Thematic Index Funds
Minimum Investment: Rs 1,000
Entry and Exit Load: None
Risk Level: Very High
Investment Strategy: Follows a passive investing approach, with 95% of investments matching the index.
Who Should Invest in This Fund? This fund is ideal for long-term investors who have a moderate risk tolerance and want to invest in low-volatility stocks.
It’s also suited for those who prefer a more structured, disciplined approach compared to actively managed funds.
Risks: While it focuses on low-volatility stocks, the fund still carries market risks, tracking errors, and risks from using derivatives.
Nippon India Nifty 500 Quality 50 Index Fund
The second fund, the Nippon India Nifty 500 Quality 50 Index Fund, tracks the Nifty 500 Quality 50 TRI Index.
This index includes the top 50 companies based on quality factors such as high return on equity, stable earnings, and low debt.
Key Features
Category: Open-Ended Index Funds
Minimum Investment: Rs 1,000
Entry and Exit Load: None
Risk Level: Very High
Investment Strategy: Follows a passive management strategy with periodic portfolio rebalancing.
What Makes This Fund Special? This fund provides an opportunity to invest in some of the strongest and most stable companies in India.
It’s a good choice for long-term investors looking to create wealth through quality stocks at a low cost.
Risks: While the fund targets high-quality companies, it still faces market risks, tracking errors, and risks associated with derivatives and portfolio rebalancing.
