Mirae Asset Nifty India New Age Consumption ETF Fund of Fund - Direct (G)

Mirae Asset Nifty India New Age Consumption ETF Fund of Fund is an innovative mutual fund scheme designed to provide investors exposure to the rapidly evolving consumption patterns in India. The fund invests in units of the Mirae Asset Nifty India New Age Consumption ETF, which tracks the Nifty India New Age Consumption Index.

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This index represents a basket of companies that are poised to benefit from emerging consumption trends, such as digital services, e-commerce, healthcare, and other sectors driven by changing lifestyles, technological advancements, and increased consumer spending. By focusing on these dynamic sectors, the fund aims to capture growth opportunities in India's consumer-driven economy.

Details of the NFO: Mirae Asset Nifty India New Age Consumption ETF Fund of Fund - Direct (G)

Investment Objective and Strategy

Objective:

As per investment objective, the scheme will be managed passively with investment in units of Mirae Asset Nifty India New Age Consumption ETF. 

Investments made from the net assets of the Scheme would be in accordance with the investment objective of the Scheme and the provisions of the SEBI (MF) Regulations.

Investment Strategy:

The investment strategy of the Mirae Asset Nifty India New Age Consumption ETF Fund of Fund is centered on providing investors with returns that closely correspond to the performance of the Nifty India New Age Consumption Index, subject to tracking errors. The fund achieves this by primarily investing in units of the Mirae Asset Nifty India New Age Consumption ETF, which mirrors the index.

Key Components of the Strategy:

Index Tracking: The fund aims to replicate the performance of the Nifty India New Age Consumption Index by investing in the ETF that tracks this index. The index comprises a curated portfolio of companies operating in sectors that reflect emerging consumption trends, such as e-commerce, technology, healthcare, and other lifestyle-driven industries.

Passive Investment Approach: The fund follows a passive investment strategy by allocating assets to the ETF, eliminating active stock-picking. This approach aims to minimize costs and tracking errors while capturing the growth of new-age consumption sectors.

Diversification: The underlying ETF provides exposure to a diversified set of companies across various industries that are benefiting from shifting consumer preferences and technological advancements.

Long-Term Growth Focus: By aligning with sectors experiencing structural growth trends, the fund aims to capitalize on India's evolving consumption story, driven by factors such as rising disposable incomes, urbanization, digital penetration, and a young population.

This investment strategy makes the fund suitable for investors with a long-term perspective who are looking for a cost-effective and convenient way to invest in India's new-age consumption sectors.

Why Invest in Mirae Asset Nifty India New Age Consumption ETF Fund of Fund - Direct (G)?

Investing in the Mirae Asset Nifty India New Age Consumption ETF Fund of Fund offers a unique opportunity to capitalize on India's rapidly evolving consumption landscape. Here are key reasons to consider investing in this fund:

1. Exposure to Emerging Consumption Themes

The fund provides access to sectors that represent India's "new-age" consumption story, such as digital services, e-commerce, healthcare, fintech, and other high-growth industries. These sectors are poised to benefit from technological advancements and changing consumer behaviors.

2. Participation in India's Growth Story

India's growing middle class, rising disposable incomes, increased internet penetration, and urbanization are driving significant shifts in consumption patterns. The fund captures these trends through its focus on companies aligned with these growth drivers.

3. Diversified Portfolio

By investing in the Mirae Asset Nifty India New Age Consumption ETF, the fund provides diversification across multiple sectors and companies, reducing concentration risk and enhancing growth potential.

4. Convenience of a Fund of Fund Structure

Investors can gain indirect exposure to an exchange-traded fund (ETF) without the need for a demat account or direct ETF trading. This structure makes it easier and more accessible for retail investors to participate in the growth of new-age industries.

5. Cost-Efficient Passive Strategy

The fund follows a passive investment strategy, aiming to closely replicate the performance of the Nifty India New Age Consumption Index. This approach keeps costs relatively low compared to actively managed funds.

6. Long-Term Wealth Creation

By targeting sectors with structural growth potential, the fund is well-suited for investors looking to build wealth over the long term, while riding on transformative consumption trends in the Indian economy.

7. Backed by Expertise

Mirae Asset is a globally recognized asset management company known for its robust research and fund management expertise, ensuring efficient portfolio management and alignment with the index.

This fund is ideal for investors who seek to diversify their portfolio, embrace emerging opportunities in the Indian market, and benefit from a passive yet targeted investment approach focusing on new-age consumption.

Strength and Risks - Mirae Asset Nifty India New Age Consumption ETF Fund of Fund - Direct (G)

Strengths:

The Mirae Asset Nifty India New Age Consumption ETF Fund of Fund stands out due to several strengths that make it an attractive investment option:

1. Focused on Emerging Growth Sectors

The fund targets companies that are positioned to benefit from evolving consumption trends in India, including e-commerce, digital technology, healthcare, and fintech. These are high-growth areas driven by innovation and changing consumer behavior.

2. Aligned with India's Consumption Growth Story

With a young population, rising incomes, and increasing urbanization, India's consumption story is on a strong upward trajectory. The fund taps into this structural growth potential by investing in companies shaping the future of consumption.

3. Diversification Across New-Age Themes

By investing in the Mirae Asset Nifty India New Age Consumption ETF, the fund offers broad-based exposure to multiple sectors and industries within the new-age consumption space, reducing dependence on any single company or sector.

4. Passive Investment Efficiency

The fund employs a passive investment strategy, which eliminates active stock selection risk. It closely mirrors the Nifty India New Age Consumption Index, ensuring alignment with market trends in the target sectors.

5. Cost-Effective Structure

Passive funds generally have lower expense ratios compared to actively managed funds. This cost efficiency benefits long-term investors by reducing the drag on returns.

6. Accessibility for Retail Investors

As a fund of fund, it does not require a demat account for investment, making it accessible to a wider pool of investors who might otherwise find direct ETF investments cumbersome.

7. Support from a Trusted Asset Manager

Backed by Mirae Asset, a globally renowned asset management company with a strong track record of delivering consistent performance, the fund benefits from robust research, efficient execution, and deep market expertise.

8. Resilient to Economic Cycles

The focus on consumption-driven sectors ensures the fund is less affected by economic slowdowns, as consumer spending, particularly in digital and essential services, tends to remain strong even during challenging times.

9. Long-Term Wealth Creation Potential

By investing in companies that are leaders in their respective fields and benefiting from transformative trends, the fund offers significant potential for wealth creation over the long term.

These strengths make the Mirae Asset Nifty India New Age Consumption ETF Fund of Fund a compelling choice for investors seeking to participate in India's evolving consumption landscape with a low-cost, diversified, and professionally managed approach.

Risks:

While the Mirae Asset Nifty India New Age Consumption ETF Fund of Fund offers compelling growth potential, it is important to consider the associated risks before investing. Here are the key risks:

1. Market Risk
The fund's performance is directly linked to the performance of the Nifty India New Age Consumption Index and the underlying companies. If the broader market or specific sectors within the index face a downturn, the fund's value may decline.

2. Sector Concentration Risk
Since the fund primarily focuses on new-age consumption sectors (e.g., digital services, e-commerce, healthcare), it is less diversified across the broader economy. Poor performance in these sectors due to regulatory changes, competition, or economic slowdowns may impact the fund's returns.

3. Volatility Risk
Emerging and fast-growing industries often experience higher volatility compared to mature sectors. Stocks in the new-age consumption space may exhibit sharp price fluctuations, which can impact short-term fund performance.

4. Tracking Error Risk
As a fund of fund investing in an ETF, the fund's returns may deviate slightly from the index it tracks due to tracking errors in the underlying ETF, operational costs, and cash holding positions.

5. Economic and Policy Risks
Sectors targeted by the fund are sensitive to economic conditions and government policies. For example:
Changes in taxation or regulations affecting digital businesses.
Policy shifts in healthcare or fintech sectors. Such changes can impact company profitability and, in turn, fund performance.

6. Foreign Investment Risk (if applicable)
If the underlying ETF includes companies with global operations or foreign-listed stocks, it may be subject to currency fluctuations, geopolitical risks, and international market volatility.

7. Liquidity Risk
Although ETFs are generally liquid, the fund's investments in units of the Mirae Asset Nifty India New Age Consumption ETF could face liquidity challenges in extreme market conditions, affecting its ability to execute transactions efficiently.

8. Passive Investment Risk
The fund does not actively manage its portfolio to take advantage of market opportunities or mitigate risks. This means it may not outperform the index during favorable market conditions or shield against losses in downturns.

9. Limited Historical Performance
As a relatively new fund category targeting emerging sectors, there may be limited historical data to predict future performance or assess how the index behaves across different market cycles.

10. Macroeconomic Risks
Factors like inflation, interest rate changes, or global economic uncertainties can indirectly impact consumer spending patterns and, consequently, the performance of the companies in the index.