UTI Mutual Fund will launch SUNDER (S&P CNX Nifty UTI Notional Depository Receipts Scheme), a passively managed open-ended exchange traded fund tomorrow.
The scheme provides the whole of the Nifty index in one unit. The face value of each unit is Rs 100. Valuation of each unit will be around one-tenth of the value of the Nifty.
The SUNDER units will initially be listed on the National Stock Exchange. The minimum application size is 10,000 units plus in multiples of 2,000 units in case of authorised participants and 5,00,000 units plus in multiples of 20,000 units for other investors.
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The UTI Asset Management Company will issue and redeem the SUNDER units only in creation unit size in exchange for S&P CNX Nifty index securities, cash component and balancing amount, if any.
The minimum trading lot for the SUNDER shares in the market will be one unit. The units will be totally dematerialised.
UTI Mutual Fund has also appointed authorised participants who are expected to give two-way quotes in the secondary market for ensuring liquidity in SUNDER units.