Axis MF Files Draft For Axis Nifty AAA Bond Financial Services – Mar 2028 Index Fund

The Axis Nifty AAA Bond Financial Services – Mar 2028 Index Fund is an open-ended target maturity index fund. It passively tracks the Nifty AAA Financial Services Bond Mar 2028 Index, aiming to replicate its performance before fees and expenses. 

The fund is for investors with moderate interest rate risk tolerance and low credit risk preferences. Its maturity date aligns with the index’s target of March 31, 2028.

Asset Allocation

The fund invests 95%-100% of its portfolio in AAA-rated financial services bonds included in the index. A maximum of 5% of assets can be allocated to money market instruments to manage liquidity needs. These allocations will help align with the benchmark while maintaining liquidity for redemption requests.

Investment Plans and Minimum Contributions

The fund offers two plans: Direct and Regular. Both plans come with Growth and Income Distribution cum Capital Withdrawal (IDCW) options.

• Minimum investment during the NFO: ₹5,000.
• Additional investments: ₹1,000 and multiples of ₹1 thereafter.
• Units are priced at ₹10 per unit during the New Fund Offer period.

The New Fund Offer (NFO) dates are yet to be announced 

Expense Ratio and Fees

The fund’s expense ratio is capped at 1%, as per SEBI regulations. Direct plans exclude distributor commissions, reducing costs for investors. Importantly, there is no entry or exit load, making the fund more accessible without additional charges.

Redemption and Liquidity

Investors can redeem units on any business day, with redemption proceeds typically disbursed within three working days. Units will automatically mature on March 31, 2028, and the proceeds will be credited within the same timeline.

Benchmark and Tracking

The fund’s benchmark is the Nifty AAA Financial Services Bond Mar 2028 Index. While it aims to track the index precisely, minor deviations (tracking error) may occur due to operational factors or market conditions.

Key risks include interest rate fluctuations and liquidity concerns. However, the inclusion of AAA-rated bonds minimizes credit risk.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.