Mirae Asset Mutual Fund has launched a fresh large cap fund in the equity category. The Mirae Asset Nifty 200 Alpha 30 ETF’s subscription period began on October 9 and runs until October 18, 2023.
It’s an open-ended scheme, offering investors the flexibility to redeem their investments at any time. The fund will reopen for regular purchases and redemptions on October 23, 2023.
Start Investing with Just ₹5000
Investors can initiate investments with a minimum of ₹5000 during the NFO phase, and thereafter, they can add multiples of Re 1.
ETF will be listed on both NSE and BSE within five days of allotment. The fund will be managed by Ekta Gala and Vishal Singh.
Understanding the Nifty 200 Alpha 30 Index
The Nifty 200 Alpha 30 index comprises 30 large and midcap stocks chosen from the Nifty 200 index based on their ‘Jensen Alpha’ performance metric. Stocks with higher alpha scores will carry more weight in the portfolio.
Rising Popularity of Smart Beta ETFs
Globally, smart beta ETFs have gained significant popularity as investment products. As of February 2023, there are 1281 smart beta equity ETFs listed, totaling $1.27 trillion in assets under management.
Who Should Consider Investing
Siddharth Srivastava, Head of ETF Products at Mirae Asset Investment Managers, explains that Mirae Asset Nifty 200 Alpha 30 ETF will adhere to an alpha and momentum strategy.
The portfolio will consist of 30 large and midcap stocks selected based on their alpha performance, rather than their free float market capitalization.
Frequent quarterly rebalancing will be used to identify market trends and top-performing stocks.
This approach will lead to portfolio exposure shifting between large and midcap segments and sectors based on performance cycles.
Srivastava notes that in a growing market like India, the alpha strategy has historically performed well, especially during bullish market conditions.
However, it’s important to recognize that it can also exhibit significant volatility.
Investors seeking to pursue a momentum/alpha strategy, after assessing their risk tolerance, may find this product suitable.
