HDFC Asset Management Company, one of India’s leading mutual fund houses with ₹ 4.35 trillion in assets under management has announced launch of New Fund Offer – HDFC NIFTY Next 50 Index Fund (“the Fund”), for investors looking for returns that are commensurate with the performance of NIFTY Next 50 Index, subject to tracking error. NIFTY Next 50 Index represents 50 companies from NIFTY 100 after excluding the constituents of NIFTY 50 Index.
HDFC NIFTY Next 50 Fund is suitable for investors looking for simple yet cost effective way of investing in ‘Next Top 50’ companies on the listed universe of NSE.
HDFC AMC has an experience of 19 years and is one of the oldest in the industry in managing passive funds. It is also a leading investment manager (in terms of AUM) in the index fund category. This experience translates into some of the tightest benchmark tracking in the field of index fund management. HDFC NIFTY Next 50 Index Fund will offer exposure to diversified portfolio at sector/ stock level. The Fund will provide exposure to unique businesses and differentiated businesses as compared to Nifty50.
HDFC NIFTY Next 50 Index Fund is an open-ended scheme replicating/ tracking NIFTY Next 50 Index (TRI). The NIFTY Next 50 Index is more diversified with top 3 sectors’ weight pegged at 58% as compared to 67% for NIFTY 50, and thereby may offer better risk adjusted returns in long term. The Fund will be managed passively and the investment universe of the fund will be the constituents of NIFTY Next 50 Index. The new fund offer (NFO) will open on October 22, 2021, and will close on October 29, 2021.
Commenting on HDFC NIFTY Next 50 Index Fund, Krishan Kumar Daga, Senior Fund Manager, HDFC AMC said, “HDFC NIFTY Next 50 Index Fund offers exposure to diversified portfolio at sector/ stock level. NIFTY Next 50 Index has favourable risk-reward ratio as compared to NIFTY 50 Index. NIFTY Next 50 has outperformed NIFTY 50 Index over 19 year period ended September 30, 2021. Out of 75 stocks that were included in NIFTY 50 index during January 2002 – March 2021, about 51 stocks were from NIFTY Next 50 Index. Thus the Fund offers investors an opportunity to invest in basket of tomorrow’s potential NIFTY 50 Companies.”
Further Navneet Munot, MD & CEO, HDFC AMC said, “Launch of HDFC NIFTY Next 50 Index Fund is a part of our endeavor to expand our product bouquet in the passive space. HDFC AMC has been one of the oldest players in the passive strategies with proven capability.”