Leading asset management company Axis Mutual Fund will be floating its Axis NASDAQ 100 Fund of Fund. As per the details, the new fund will be an open-ended fund of fund scheme that would invest in units of exchange-traded funds focused on the Nasdaq 100 TRI.
It is to be noted here that the fund of funds, also known as a multi-manager investment, is a pooled investment fund that puts money in different types of funds. Basically, these instruments invest in different underlying portfolios of other funds, and replace direct investment in bonds, stocks, like regular ETFs.
As per the details, the Axis NASDAQ 100 Fund of Fund would focus on replicating the performance of the NASDAQ 100 TRI by investing in ETFs whose primary objective would be to track/replicate the performance of the Nasdaq 100 TRI, subject to tracking errors.
The NASDAQ 100 Index consists of the top 100 of the largest non-financial companies on the NASDAQ stock market, based on their market capitalisation. The current NASDAQ 100 Index is a tech-heavy index and has exposure to new economy sectors such as healthcare, technology, and consumer.
Besides, the fund claims to work as a hedge against the Indian Rupee depreciation.
The minimum application amount would be Rs 500 per application and in multiples of Re 1 thereafter. Hitesh Das, Fund Manager – Overseas Investments, will be overseeing the Axis NASDAQ 100 Fund of Fund, the fund would be benchmarked against the NASDAQ 100 TRI. The NFO will open for subscription on October 7 and will close on October 21.
Crucial points to note
The company has said that the fund would be investing in some overseas NASDAQ-100 ETFs tracking NASDAQ 100 Index, such as the Xtrackers Nasdaq 100 UCITS ETF, iShares NASDAQ 100 UCITS ETF, Invesco EQQQ NASDAQ-100 UCITS ETF
These ETFs have historically demonstrated their ability for comparatively lower tracking error, thereby benefiting the fund. The fund would give the investors access to some of the largest non-financial companies.
Chandresh Nigam, MD, and CEO, Axis AMC said, “With global boundaries slowly blurring, investors are eager to gain access to some international growth stories, which was earlier not feasible so seamlessly. With the Axis NASDAQ 100 Fund of Fund, we are presenting investors with the opportunity to gain global exposure. We are confident that the fund’s philosophy and underlying structure will make it a valuable addition for investors.”
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