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SBI's new Index Fund targets Top 30 quality stocks - How you can invest
SBI Mutual Fund, India's largest fund house, on Thursday launched the SBI Nifty200 Quality 30 Index Fund, an open-ended scheme replicating/ tracking Nifty200 Quality 30 Index. The New Fund Offer (NFO) period for the scheme is May 16 – 29, 2025.
The investment objective of the scheme is to provide returns that correspond to the total returns of the securities as represented by the underlying index, subject to tracking error. However, there is no guarantee or assurance that the investment objective of the scheme will be achieved.
The Nifty200 Quality 30 index includes top 30 companies from its parent Nifty 200 index, selected based on their 'quality' scores. The quality score for each company is determined based on return on equity (ROE), financial leverage (Debt/Equity Ratio) and earning (EPS) growth variability analysed during the previous 5 years. The weights of the stocks are derived from their Quality scores and square root of free float market cap. The stock weight is capped at 5%
The scheme would primarily invest a minimum of 95% and a maximum of 100% of its assets in stocks comprising the Nifty200 Quality 30 and up to 5% in Government securities (like G-Secs, SDLs, and treasury bills), including triparty repo and units of liquid mutual fund.
The minimum application amount during the NFO is of Rs. 5,000 and in multiples of Re. 1 thereafter with additional purchases of Rs. 1,000 and in multiples of Re. 1 thereafter.
Investments can also be done through daily, weekly, monthly, quarterly, semi-annual, and annual SIP (Systematic Investment Plan).
The Nifty200 Quality 30 Index is designed to track the performance of the top 30 companies within the Nifty200 index, selected based on stringent quality metrics such as financial health, profitability, and sustainable growth.
"I believe the SBI Nifty200 Quality 30 Index Fund can be a valuable addition for investors, enabling them to invest in quality companies passively for long-term wealth creation," said Nand Kishore, MD & CEO, SBI Funds Management Limited.
The fund manager for the SBI Nifty200 Quality 30 Index Fund is Viral Chhadva, who has been associated with the fund house since December 2020. He currently manages passive offerings such as the SBI Nifty50 Equal Weight ETF (an open-ended Exchange Traded Fund replicating/tracking the Nifty 50 Equal Weight Index), the SBI Nifty50 Equal Weight Index Fund (an open-ended scheme replicating/tracking the Nifty 50 Equal Weight Index), and the SBI Nifty 500 Index Fund (an open-ended scheme replicating/tracking the Nifty 500 Index).
'The Nifty200 Quality 30 Index represents a focused selection of high-quality companies from the broader Nifty200 universe, chosen through rigorous metrics such as financial strength, consistent profitability, and long-term growth potential. With the launch of the SBI Nifty200 Quality 30 Index Fund, we aim to offer investors a smart, relatively low-cost solution to gain exposure to quality businesses and build long-term wealth through a passive approach," said D P Singh, Deputy MD & Joint CEO, SBI Funds Management Limited.
What Does This Fund Offer?
Index-based passive investing: The fund passively mirrors the Nifty200 Quality 30 Index, allowing investors to benefit from the performance of these top-tier companies without trying to beat the market.
Low minimum investment: You can start with just ₹5,000 during the New Fund Offer (NFO) period, which runs from May 16 to May 29, 2025.
Flexibility: Investors can set up SIPs (Systematic Investment Plans) daily, weekly, monthly, or even annually.
No long-term exit load: Withdraw within 15 days and pay a 0.25% exit load. Exit after that, and it's free.
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