Tata Mutual Fund has introduced the Tata Nifty India Digital Exchange Traded Fund, an open-ended ETF that replicates/tracks the Nifty India Digital Index.
The NFO’s subscription period began today and will end on March 25. There is no entry or exit load in this scheme. The minimum subscription amount is ₹5,000 and multiples of ₹1 thereof.
Meeta Shetty will manage the fund, and its performance will be benchmarked against the Nifty India Digital Index. According to the fund house, the value of each unit on the allotment will be approximately 1/100th of the underlying index.
The Nifty India Digital Index is designed to follow the performance of a portfolio of stocks that generally represent the digital theme in core areas such as software, e-commerce, IT-enabled services, industrial electronics, and telecom services. NSE Indices pick the largest 30 stocks from eligible primary industries based on their 6-month average free-float market capitalization at the end of January and July cutoff dates. The free-float market capitalization of the stocks in the index determines their weight. Each sector’s weight is capped to 50%, while each stock’s weight is limited to 7.50%.
As of February 28, 2022, the index’s top constituents by weightage are Bharti Airtel, TCS, Indian Railway Catering and Tourism, HCL Technologies, Infosys, Tata Communications, Info Edge, Tech Mahindra, Wipro, and Honeywell Automation India.
This Tata Mutual Fund ETF is distinct from the Tata Digital India Fund, an open-ended fund that invests in the information technology sector. The latter fund’s core portfolio consists of large and mega IT services corporations, while the satellite portfolio consists of rising technologies and services firms.