Moneycontrol
Get App
Last Updated : Apr 25, 2019 03:14 PM IST | Source: Moneycontrol.com

Aditya Birla Sun Life Mutual Fund seeks SEBI nod for banking ETF

The units of the scheme will be compulsorily traded in dematerialised form, and hence there will be no entry/exit load for units purchased or sold through stock exchanges, as per the draft offer document

Moneycontrol News @moneycontrolcom

Aditya Birla Sun Life Mutual Fund has sought the Securities and Exchange Board of India’s approval to launch Aditya Birla Sun Life Banking ETF, according to the draft offer document on the market regulator’s website.

The open-ended exchange traded fund (ETF) tracking the Nifty Bank will deploy at least 95 percent of its assets in stocks comprising the index, with the balance allocated to debt and money market instruments.

The units of the scheme will be compulsorily traded in dematerialised form, and hence there will be no entry/exit load for units purchased or sold through stock exchanges, as per the draft offer document.

Close

ETFs are usually passively managed funds wherein subscription/redemption of units work on the concept of exchange with underlying securities. Units can be bought and sold directly on the exchange.

ETFs have all the benefits of indexing such as diversification, low cost and transparency. As ETFs are listed on the exchange, costs of distribution are much lower and the reach wider.

These savings in cost are passed on to the investors in the form of lower costs. The exchange-traded mechanism helps reduce minimal collection, disbursement and other processing charges. The ETF structure is such that it protects long-term investors from inflows and outflows of short-term investors as it does not bear extra transaction cost when buying/selling due to frequent subscriptions and redemptions.

Other features:
Minimum investment: Rs 5,000 and in multiples of Rs 1,000 thereafter
Performance Benchmark: Nifty Bank IndexFund manager: Lovelish Solanki

India Union Budget 2019: What does Finance Minister Nirmala Sitharaman have up her sleeve? Click here for top and latest Budget news, views and analyses.
First Published on Apr 25, 2019 03:14 pm
Loading...
Sections
Follow us on
Available On
PCI DSS Compliant