Mirae Asset Nifty 50 Index Fund - Direct (G): NFO Details

Investment Objective and Strategy

Objective:

The investment objective of the scheme is to generate returns, before expenses, that are commensurate with the performance of Nifty Total Market Total Return Index, subject to tracking error. 

There is no assurance or guarantee that the investment objective of the scheme would be achieved.

Investment Strategy:

Mirae Asset Nifty 50 Index Fund - Direct (G) aims to replicate the portfolio of the Nifty 50 Index. It closely tracks the index by investing in the same 50 large-cap companies, and maintains their weightage close to the index composition. It seeks returns akin to and aligned with the Index, before accounting for expenses and tracking errors. It does not attempt to outperform the index but manages a broad market exposure with reduced active risk. Focuses on large, stable companies from diversified sectors, offering a cost-effective option to participate in India's equity market from a growth long-term perspective.

Why Invest in Mirae Asset Nifty 50 Index Fund - Direct (G)?

Investing in the Mirae Asset Nifty 50 Index Fund - Direct (G) is one of the inexpensive ways to own the top 50 large-cap companies of India. This index fund is a passively managed fund wherein it can replicate the performance of the Nifty 50 Index for diversifying investments across key sectors of banking, IT, energy, and consumer goods. The direct plan has lower expense ratios, which subsequently enhances long-term returns by trimming costs. This fund is well suited for the investor seeking broad market exposure, a simple investment approach, and the potential to benefit from India's economic growth over time. Given this long-term perspective, the fund will present a balanced risk-return profile for all investors who like to take a hands-off strategy without needing active management.

Strength and Risks - Mirae Asset Nifty 50 Index Fund - Direct (G)

Strengths:

Investing in the Mirae Asset Nifty 50 Index Fund - Direct (G) offers several key strengths:

• Diversified Market Exposure: An investment is made in a diversified portfolio of India's largest 50 large-cap companies operating in sectors including banking, IT, consumer goods, energy, and healthcare, thereby providing much-needed safety against the risk of sector overexposure and company exposure.
      
• Cost Efficiency: It is a passive fund and ensures that the expense ratios are lower than those of the actively managed funds. This can translate into better long-term returns through fee avoidance, so an attractive proposition for cost-conscious investors.
      
• Simplicity and Transparency: This fund is committed deeply to a simple strategy of replicating the Nifty 50 Index, making it transparently invested in all holdings. Easy tracking of the index, too, facilitates understanding where the money is being invested.
      
• Risk-Adjusted Growth Potential: This Fund focuses on large, stable, and established companies that will be there for growth with relatively less risk. It tends to have good fundamentals and has lesser susceptibility to the vagaries of the market.
      
• Long-term investment: Best suited for investors with a long-term time horizon, it can potentially benefit from India's growing economy and corporate profits over time.

Risks:

A passive fund, Mirae Asset Nifty 50 Index Fund - Direct (G) follows the Nifty 50 Index in an uncomplicated way, which makes it vulnerable to the vagaries of the market. This fund would see its returns deteriorate if the market or the large-cap majors in the index decline. The fund is not managed to beat the index, hence higher returns through active management are also ruled out. There's concentration risk - it invests in the largest 50 companies in the portfolio, thus limiting opportunities that may arise from mid- or small-cap growth. Tracking error is also one of the risks, and it simply refers to the position of the fund performing marginally differently from the index results due to fees and other reasons. It is also important for the investor to be aware of these types of risks and their limits before investing.