Mutual funds accelerate launch of new passive investment products

With early signs of recovery in the equity markets, mutual funds are rushing to launch passive products which will benefit the most on revival of key indices.

SBI Mutual Fund will launch two new exchange traded funds Nifty200 Value 30 ETF and Nifty Smallcap 250 ETF.

Both the schemes will open for subscription on May 7.

The SBI Nifty200 Value 30 ETF aims to track the performance of 30 companies selected from the Nifty 200 based on value parameters such as earnings-to-price ratio, book value-to-price ratio, Sales to Price ratio and Dividend Yield.

DP Singh, Joint CEO, SBI Funds Management, said the ETF launches broaden the fund houses equity passive suite and enhance the solution set available to investors and distributors, addressing distinct portfolio needs based on fundamentally screened stocks to access to the long-term growth potential of the small-cap segment.

Groww Mutual Fund has launched ETF on Nifty Private Bank index. The ETF aims to provide investors with a transparent and rules-based way to gain exposure to India’s private banking segment.

Over the past decade, private banks’ share of total deposits has increased from 21 per cent to 38 per cent, indicating sustained competitive positioning within the sector. The NFO opened on Wednesday.

The Nifty Private Bank index comprises 10 private sector banks selected based on liquidity, market capitalisation, and other eligibility criteria, and follows a free-float market capitalisation weighting methodology.