Axis MF to launch Axis Nifty500 Value 50 Index Fund

Axis Mutual Fund has announced plans to launch its latest offering, the Axis Nifty500 Value 50 Index Fund, an open-ended index fund designed to replicate the performance of the Nifty500 Value 50 Total Return Index (TRI). The New Fund Offer (NFO) opens on October 4, 2024, and will close on October 18, 2024, with an aim to offer a low-cost investment solution focused on value stocks, providing long-term wealth creation opportunities.

Investment Strategy

The Axis Nifty500 Value 50 Index Fund follows a passive investment approach, tracking the Nifty500 Value 50 TRI. This index consists of 50 stocks selected from the Nifty 500 universe based on their Price to Earnings (P/E), Price to Book (P/B), Price to Sales (P/S), and dividend yield metrics. These criteria aim to target companies with strong valuation multiples, offering “true to label” value investing.

According to Axis Mutual Fund, value investing is a subset of factor investing, which targets undervalued or less expensive stocks. The fund will be listed on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), giving investors easy access to buy and sell units at market prices.

Key Benefits

• Diversified Exposure: The fund limits stock weights to a maximum of 5% and sector weights to 25%, ensuring sufficient diversification.
• Low Cost: As a passively managed fund, it offers lower expenses than its actively managed counterparts, making it a cost-effective option.
• Long-Term Wealth Creation: The Nifty500 Value 50 Index has historically outperformed the broader Nifty500 Index over the long term.

Who Should Invest?

This fund is ideal for long-term investors looking to gain exposure to value stocks in India and experienced investors seeking to complement their portfolios with a passive strategy.

Conclusion: With the rising interest in value-based investing, the Axis Nifty500 Value 50 Index Fund seems to offer a timely opportunity to invest in undervalued companies with a good potential for long-term returns, making it an attractive option for those seeking a stable, value-driven approach.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.