SBI Nifty 500 Index Fund NFO closure date extended:The country’s largest fund house SBI Mutual Fund has extended the subscription date for the New Fund Offer (NFO) of its new index fund. Subscription to the NFO of SBI Nifty 500 Index Fund was earlier open till 24 September 2024, but now investors can apply for it till 26 September 2024. The fund house has informed its unitholders about this change through a notice.
What is SBI Nifty 500 Index Fund?
SBI Nifty 500 Index Fund is an open-ended equity scheme that tracks the Nifty 500 Index. This index covers the stocks of the top 500 companies in India, including large-cap, mid-cap and small-cap segments. This scheme gives investors an opportunity to invest in the entire market through a single index.
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Objective of NFO
The main objective of this scheme is to invest in securities that are part of the Nifty 500 Index, so that investors can get returns equal to the overall market return. However, there may be some difference in the returns of the scheme, which is called tracking error.
Investment Structure of NFO
Under the SBI Nifty 500 Index Fund, 95% to 100% of the investment will be made in the stocks included in the Nifty 500 Index. Apart from this, up to 5% of the fund can be invested in government securities like G-Secs, SDLs, treasury bills, and other liquid mutual fund units.
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Fund Management
The fund manager of SBI Nifty 500 Index Fund is Viral Chhadwa, an expert in index-based investing. He has over 17 years of experience in the financial services sector. The benchmark of the fund will be Nifty 500 – TRI, which reflects the total return of the index.
In SBI Nifty 500 Index FundWhy invest?
SBI Nifty 500 Index Fund is suitable for investors looking for long-term capital growth and who want to invest in a diversified manner across the market. This fund follows a “passive” investment strategy, tracking the index and trying to generate returns accordingly.
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Minimum investment in NFO
– The minimum application amount to invest in this scheme is Rs 5,000 and thereafter additional investments can be made in multiples of Rs 1.
– Daily, Weekly, Monthly, Quarterly, Semi-Annual and Annual SIP options are also available in the fund, allowing investors to invest regularly as per their budget.
Other terms and conditions related to NFO
SBI Mutual Fund has clarified that except the subscription date, no other terms and conditions of this scheme have been changed. This notice is a part of the scheme’s information document and key information memorandum.
New dates for NFO subscription
– NFO subscription opening date: September 17, 2024
– New date for closing of subscription in NFO: 26 September 2024
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For whom is this scheme right?
SBI Nifty 500 Index Fund can be a good option for investors who want to invest in large cap, mid cap and small cap stocks simultaneously. This NFO will now remain open till 26 September 2024, so investors can take advantage of this opportunity and diversify their portfolio by investing in all segments of the market. However, being an equity scheme, this scheme has been placed in the category of Very High Risk on the riskometer. Therefore, before deciding to invest, definitely assess your risk taking capacity.
(Disclaimer: The purpose of this article is only to provide information, not to recommend investment in any scheme. Market risk is always associated with investment in mutual funds. Therefore, take any investment decision only after understanding the scheme thoroughly and taking the advice of your investment advisor.)
