IDBI Mutual Fund today announced launch of its second index fund, IDBI Nifty Junior Index Fund. The New Fund Offer will be available from September 2, to September 15, 2010. The scheme shall re-open for continuous sale and repurchase w.e.f September 27, 2010.
IDBI Asset Management Ltd. (IDBI AMC), a wholly-owned subsidiary of IDBI Bank Ltd, was launched with a focus on index investing, and a stated position that a vast majority of retail investors would benefit in the long term from passive fund management rather than active stock-picking by fund managers. In keeping with this philosophy, IDBI AMC has now announced launch of IDBI Nifty Junior Index Fund. This Fund will be managed passively and hold the securities in the same proportion as CNX Nifty Junior Index.
- CNX Nifty Junior Index was introduced on January 1, 1997, with base date being November 03, 1996 and indexed to a base value of 1000.
- As on August 30, 2010 CNX Nifty Junior Index closed at 11828.55
- The Index comprises of the next 50 most liquid large and higher mid cap stocks after the S&P CNX Nifty Index. (source: www.nse-india.com)
- CNX Nifty Junior represents about 11.35% of the total market capitalization of the NSE as of 30th June, 2010 (source: Bloomberg)
Speaking on the occasion, Mr. Krishnamurthy Vijayan, MD & CEO of IDBI Asset Management Ltd., said, “For an investor who wants to own a diversified basket of Large Caps and a diversified basket of large & higher mid-cap growth stocks, the S&P CNX Nifty and CNX Nifty Junior based index mutual funds are an ideal portfolio allocation. In my view, for the retail equity investor, the two funds are not only core, but indeed adequate and do not require an active fund to supplement this allocation. Without the risk of a fund manager’s judgment, the investor gets the best 100 stocks in the market, in terms of liquidity, governance and economic representation. Mutual Fund is about simplifying and de-mystifying equity for the investor who does not want to become highly technically savvy and would yet like to participate in the India growth story”
The investment objective of IDBI Nifty Junior Index Fund is to invest only in and all stocks comprising the CNX Nifty Junior Index in the same weights of these stocks as in the index with the objective to replicate the performance of the Total Returns Index of CNX Nifty Junior Index. The scheme may also invest in derivative instruments such as Futures and Options linked to stocks comprising the Index or linked to CNX Nifty Junior Index. The Scheme will seek to achieve the investment objective by minimizing the tracking error between the Total Returns Index of CNX Nifty Junior Index and the scheme.
The face value of each unit will be Rs.10 and the minimum investment will be Rs.5000 and in multiples of Rs.100 thereafter. Under the Systematic Investment Plan (SIP) investors can pay Rs.500 per month for a minimum period of 12 months or Rs.1000 pm for a minimum period of 6 months or Rs.1500 per quarter for a minimum 4 quarters continuously.
About IDBI Asset Management Ltd.
IDBI Asset Management Ltd, is a wholly-owned subsidiary of IDBI Bank Ltd. The sponsor for the IDBI MF is IDBI Bank Ltd and the Trustee Company is IDBI MF Trustee Company Ltd. IDBI MF’s goal is to benefit investors through Index Investing. For further details, please contact Ms Arpana Bhatia, tel. no. 022-66096104 or visit www.idbimutual.co.in
Risk factors: Mutual funds investments are subject to market risks, read all scheme related documents (SAI/SID/KIM) carefully.
