Edelweiss launches India's first ETF for capital markets, insurance Sectors

Edelweiss Mutual Fund has launched a groundbreaking exchange-traded fund (ETF), the Edelweiss BSE Capital Markets & Insurance ETF, marking India’s first ETF dedicated to the capital markets and insurance sectors. 

 

The  open-ended scheme is designed to replicate and track the BSE Capital Markets & Insurance Total Return Index ,which includes leading companies in both sectors. By investing in this ETF, investors will be able to tap into a diversified portfolio of top-performing capital markets and insurance companies.

 

The New Fund Offer (NFO) will be available for subscription from December 10 to December 24, 2024.

 

This ETF offers a unique investment vehicle that aims to benefit from the wealth creation potential in capital markets and the expanding insurance industry. 

 

 

Key Highlights:

• First ETF in India that capitalises on the mega trend in financialisation of savings into capital markets and insurance
• The theme capitalises on the growth trinity of Youth, Digital, and Prosperity in India, which is set to drive the penetration of mutual funds, equities, and insurance
• The number of listed players in this theme is set for significant expansion—an opportunity to capitalise on this thriving segment
• The fund’s diversified portfolio is divided between capital markets (47.21%) & insurance (52.79%). 
• The portfolio comprises capital market firms, life insurance, general insurance, & distributors of financial products. 
• Notable constituents include HDFC AMC, Angel One, Multi Commodity Exchange Of India (MCX), Anand Rathi Wealth, SBI Life Insurance, ICICI Lombard, and ICICI Securities. 
• All the stocks constituting the ETF will be a part of the BSE 500 Index. 
• The maximum constituents are capped at 30. 
• The eligible stocks will be ranked basis their average 6-Month daily float-adjusted market capitalisation figures. 
• The ETF will be reconstituted semi-annually in June & December & rebalanced quarterly for optimal performance.

 

"This ETF is the first in a series of thematic ETFs we plan to roll out in the coming months, each designed to capture key mega trends driving India’s growth story as it moves towards becoming Viksit Bharat by 2047. The ETF market is at an inflection point, and we aim to be at the forefront of this evolution, offering investors products that are not only innovative but also meaningful for wealth creation and diversification," said Radhika Gupta, MD & CEO, Edelweiss Mutual Fund. 

The portfolio is diversified across various sectors within the financial industry, with significant investments in life insurance (37.57%) and portfolio asset management (15.53%). Key holdings include major players in life insurance like HDFC Life (10.30%) and SBI Life (8.86%). The stockbroking and allied segment represents 14%, while exchanges and data platforms contribute 10.96%, with Multi Commodity Exchange (7.86%) as a primary holding. Depositaries and clearing houses account for 5.02%, while financial products distributors like Anand Rathi Wealth contribute 1.70%.

 

Fund details:  

• Scheme Name   Edelweiss BSE Capital Markets & Insurance ETF
• Scheme Type   An open-ended scheme replicating/tracking BSE Capital Markets & Insurance TRI
• Benchmark   BSE Capital Markets & Insurance TRI
• NFO Period   10th to 24th December 2024
• NAV/unit size   1/100th value of the BSE Capital Markets & Insurance Index
• Fund Manager Mr. Bhavesh Jain

 

Minimum Application

 

• During the NFO: Minimum subscription amount of Rs. 5,000 and in multiples of Re. 1 thereafter. There is no upper limit. Units will be allotted in whole figures and the balance amount will be refunded.
• Ongoing basis: Units can be subscribed/ redeemed (in lots of 1 Unit) during the trading hours on all trading days on NSE and BSE on which the units are listed.
• Large investors can make application for subscription/ redemption directly with the AMC in Creation unit size (25,000 units) pursuant to minimum requirement of Rs. 25 Crore.
• Market maker can provide an application for any amount directly with the AMC in Creation unit size (25,000 units).