Publish Date:
Motilal Oswal Mutual Fund has launched a new scheme - Motilal Oswal 5 Year G-Sec ETF (MOFGSEC).
It is an open-ended scheme replicating/tracking the Nifty 5 yr Benchmark G-Sec Index.
The investment objective of the scheme is to seek investment return that closely corresponds (before fees and expenses) total returns of the securities as represented by the Nifty 5 yr Benchmark G-Sec Index (Underlying Index), subject to tracking error. However, there can be no assurance or guarantee that the investment objective of the Scheme would be achieved.
Under normal circumstances the scheme will invest 95% to 100% of its assets in Securities constituting Nifty 5 yr Benchmark G- Sec Index.
The scheme can invest up to 5% of its assets in Money Market instruments, units of liquid scheme or Motilal Oswal Liquid Fund including TREPS.
Accordingly, Motilal Oswal 5 Year G-Sec ETF will invest in the securities which are constituents of Nifty 5 yr Benchmark G-Sec Index in the same proportion (weightage) as in the Index and track the benchmark index. The Scheme may also invest in money market instruments, in compliance with Regulations to meet liquidity requirements.
The Nifty 5yr Benchmark G-sec Index is a single bond index tracking the most liquid 5 year benchmark security issued by the Government of India. As on 31st October 2020 the underlying constituent was 5.22% GS 2025 (IN0020200112)
The ETF offers investors an attractive low cost alternative to fixed deposit since it has practically no default risk, no lock-in, and historically attractive pre- and post-tax returns
Motilal Oswal 5 Year G-Sec ETF will be managed by Mr Abhiroop Mukherjee.
Its performance will be benchmarked against Nifty 5 yr Benchmark G-sec Index TRI.
The NFO opens for subscription on November 23, 2020, and closes on December 02, 2020.
The face value of each unit of the scheme will be Rs.10/- during the New Fund Offer Period (On allotment, the value of each unit of the Scheme would be approximately equal to 1/100th of the value of Nifty 5 yr Benchmark G-Sec Index.) and at Continuous offer for units at NAV based prices.
The minimum subscription amount is Rs 500 and in multiples of Re 1 thereafter.
The units of Motilal Oswal 5 Year G- Sec ETF shall be listed on the NSE and BSE. The trading will be as per the normal settlement cycle. The investors can buy units on an ongoing basis on NSE and BSE at the traded prices which may be close to the actual NAV of the Scheme.