Kotak Mahindra Asset Management Company (AMC) on August 7, 2023 announced the launch of Kotak S&P BSE Housing Index Fund.
The open-ended scheme will replicate and/or track the S&P BSE Housing Index. The S&P BSE Housing Index invests in companies related to the housing theme. It measures the performance of common stocks within the S&P BSE 250 Large Midcap Index.
The new fund offer (NFO) opened for subscription on August 7, 2023 and will close on August 21. Investors can invest in both the lump sum as well as the systematic investment plan (SIP) mode.
The NFO is being launched at Rs. 10 per unit, Kotak Mahindra AMC said in a press release.
During the NFO period, the minimum purchase amount will be Rs 5.000 and in multiples of Re. 1. The additional purchase will be minimum Rs. 1,000 and in multiples of Re. 1.
For the SIP mode, the minimum purchase amount will be Rs. 500, subject to a minimum of 10 instalments of Rs. 500 each.
The scheme will be available in both regular and direct plans. The scheme has been rated in the very high risk category.
According to Kotak Mahindra AMC, the investment objective of the scheme is to replicate the composition of the S&P BSE Housing Index and to generate returns that are commensurate with the performance of the S&P BSE Housing Index, subject to tracking errors.
However, there is no assurance that the objective of the scheme will be realised, it said.
Kotak Mahindra AMC said the scheme is suitable for those who are seeking long-term capital growth and also want to invest in stocks comprising the underlying index.
“Constituents are weighted by float-adjusted market capitalisation, subject to a single constituent weight cap of 5 per cent. By closely replicating this index, the Kotak S&P BSE Housing Index Fund extends diverse investment opportunities to its investors linked to the housing sector. The fund presents a cost-effective and transparent approach to capitalise on the housing theme within the Indian stock market,” Kotak Mahindra AMC said in a press release.
Nilesh Shah, managing director, Kotak Mahindra AMC said: “The Kotak S&P BSE Housing Index Fund presents a unique opportunity for investors looking to capitalise on the potential growth in the housing sector and businesses that can benefit from the real estate boom. By launching this thematic index fund, we bolster our range of passive fund offerings, enhancing our overall portfolio of investment options.”
Devender Singhal, EVP & fund manager, Kotak Mahindra AMC said: “The launch of the Kotak S&P BSE Housing Index Fund is in harmony with our steadfast dedication to providing a range of products tailored to suit various risk appetites and investment timeframes. This fund aims to present a compelling prospect for investors seeking to capitalise on the housing sector and enterprises that stand to potentially benefit from the expansion in the real estate domain. By introducing this thematic index fund, we intend to fortify our comprehensive array of passive fund offerings, thus bestowing upon investors a multitude of empowering opportunities.”