Indian Express Update

Launch of the Kotak Nifty 200 Momentum 30 Index Fund by Kotak Mahindra Mutual Fund

The Kotak Nifty 200 Momentum 30 Index Fund, an open-ended plan that mirrors the Nifty 200 Momentum 30 Index, was introduced by Kotak Mahindra Mutual Fund on May 23, 2023. The new fund offer (NFO) for the fund will be available for subscription starting on May 25 and ending on June 8, 2023.
The top 30 Nifty 200 firms, chosen based on their normalized momentum score, will be tracked by the Nifty 200 Momentum 30 Index.
“The 6-month and 12-month price returns, which have been adjusted for volatility, are used to get this normalized momentum score. This pick gives investors exposure to momentum equities across market capitalizations and several industries, according to a statement from Kotak Mahindra Mutual Fund.
The Kotak Nifty 200 Momentum 30 Index Fund's investment approach, according to Nilesh Shah, managing director of Kotak Mahindra Asset Management Company (AMC), capitalizes on the consistency of stock market patterns.
It captures the potential of equities with significant price trends compared to the general market trend. Using this kind of investing may be advantageous while the economy is expanding. However, one should be aware that momentum investing might be risky. We further improve our total passive fund options with the introduction of this smart beta index fund, he added.
Momentum investment and index funds
In order to provide returns consistent with the performance of the target index, index funds often mimic its composition. They benefit from reduced management expenses as a passive fund by following the benchmark index, which leads to less short-term trading activity.
This passive strategy is perfect for investors looking for returns that passively follow the general market at a somewhat lower cost, notwithstanding the absence of an active fund manager.
However, as momentum investing constantly aims to profit from market volatility, it could need more frequent stock purchases and sales depending on the pattern of recent market moves.
Who Must Invest?
The Kotak Nifty 200 Momentum 30 Index Fund, according to Kotak Mahindra Mutual Fund, is the best option for investors looking for long-term capital growth. Additionally, the fund provides diversity across all sectors, which lowers risk, by offering passive investments in equities that replicate the composition of the Nifty 200 Momentum 30 Index.

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