India’s financial services sector has become increasingly appealing to investors due to its robust growth and potential across different company sizes. The mid and small-cap segments in particular present significant opportunities, often overlooked by larger indices. In response to this, Motilal Oswal Mutual Fund has launched the Motilal Oswal Nifty MidSmall Financial Services Index Fund NFO, an open-ended index fund that tracks the performance of the Nifty MidSmall Financial Services Index.
This new fund seeks to provide investors with exposure to financial services companies within the mid and small-cap segments, making it ideal for long-term investors seeking growth in a diversified manner.
Details of Motilal Oswal Nifty MidSmall Financial Services Index Fund
The Motilal Oswal Nifty MidSmall Financial Services Index Fund NFO is an open-ended index fund that mirrors the performance of the Nifty MidSmall Financial Services Total Return Index (TRI). This fund offers investors a unique opportunity to participate in the growth of financial service companies that are typically mid and small caps, providing sector-focused exposure within a single investment.
Investment Objective of the Fund
The investment objective of the Motilal Oswal Nifty MidSmall Financial Services Index Fund is to generate returns in line with the Nifty MidSmall Financial Services TRI, before expenses, subject to tracking error. The fund provides a cost-effective means for investors to access the potential growth within the mid and small-cap financial services sector. This fund is suitable for investors with a moderate-to-high risk tolerance who are comfortable with the volatility associated with mid and small-cap stocks.
Key Details of Motilal Oswal Nifty MidSmall Financial Services Index Fund
| Attributes | Details |
| Fund House | Motilal Oswal Mutual Fund |
| Risk Profile | Very High |
| Fund Manager | Mr. Swapnil Mayekar , Rakesh Shetty |
| Category | Index Fund |
| NFO Opens | October 29, 2024 |
| NFO Closes | November 06, 2024 |
| Benchmark Index | Nifty MidSmall Financial Services TRI |
| Exit Load | 1% if redeemed on or before 15 days thereafter NIL |
| Minimum Investment | Rs. 500 and in multiples of Re. 1 thereafter. |
Portfolio Construction
Motilal Oswal Nifty MidSmall Financial Services Index Fund NFO allocates its assets to provide comprehensive exposure within the mid and small-cap financial services sectors, including:
| Instruments | Indicative Allocations (% of Total Assets) |
| Constituents of Nifty MidSmall Financial Services Total Return Index | 95% – 100% |
| Liquid schemes/debt schemes, debt and/or money market instruments | 0% – 5% |
This diversified approach within financial services offers investors sectoral depth and access to companies beyond the large-cap-dominated financial indices.
Understanding Risks and Returns
As an index fund, the Motilal Oswal Nifty MidSmall Financial Services Index Fund aims to closely replicate the performance of the Nifty MidSmall Financial Services TRI. The fund’s focus on mid and small-cap financial services companies means higher growth potential, but also higher risk due to market volatility and sector-specific challenges.
Nifty MidSmall Financial Services TRI has delivered returns of 39.54% and 19.88% in the past 1 year, and 5 years respectively.
Motilal Oswal Nifty MidSmall Financial Services Index Fund’s diversified structure across different financial services subsectors can offer balanced exposure within the mid and small-cap space. However, investors should be aware of tracking errors and market fluctuations inherent to index funds, particularly those in the mid and small-cap sectors.
Motilal Oswal Asset Management Company (MOAMC)
Motilal Oswal Asset Management Company (MOAMC) is a SEBI-registered portfolio manager that operates the Motilal Oswal Mutual Fund (MOMF). It is supported by Motilal Oswal Financial Services Limited (MOFSL), which is listed on major Indian stock exchanges like BSE and NSE. MOAMC obtained its SEBI registration in 2009.
As of June 30, 2024, Motilal Oswal Mutual Fund manages assets worth over ₹66,452.27 crore and offers more than 40 Mutual Funds schemes. Some of its well-known schemes include the Motilal Oswal Flexi Cap Fund, Motilal Oswal Nifty India Defence Index Fund, and Motilal Oswal NASDAQ 100 ETF, based on their assets under management (AUM).
Meet the Fund Managers
Motilal Oswal Nifty MidSmall Financial Services Index Fund is managed by skilled professionals with experience in India’s financial services sector:
Mr. Swapnil Mayekar
Fund Manager Age: 39 years Qualification: Master of Commerce (Finance Management) Swapnil Mayekar has over 13 years of experience in fund management and product development. He manages several schemes, including the Motilal Oswal Nifty 50 Index Fund and the Motilal Oswal Nasdaq 100 Fund of Fund, demonstrating his expertise in index funds and market strategies.
Rakesh Shetty
Fund Manager – Debt Components Age: 42 years Qualification: Bachelor of Commerce (B.Com) Rakesh Shetty oversees the debt components of various funds, bringing significant expertise to the role. He manages key funds such as the Motilal Oswal Ultra Short Term Fund and the Motilal Oswal Liquid Fund, focusing on stable returns through debt securities.
Who Should Invest in This Fund?
The Motilal Oswal Nifty MidSmall Financial Services Index Fund NFO is well-suited for:
- Investors seeking long-term capital appreciation within the financial services sector.
- Individuals looking for diversification through mid and small-cap financial services companies.
- High-risk-tolerant investors who are comfortable with the market fluctuations common to mid and small-cap stocks.
This fund is an ideal choice for investors aiming to leverage the potential growth of India’s mid and small-cap financial services sector, benefiting from the targeted approach of a sector-focused index fund.
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