NEW DELHI: Mirae Asset Investment Managers on Wednesday launched a New Fund Offer (NFO) for an exchange traded fund (ETF) that will invest in top 50 mega-cap companies of the US that are also part of S&P 500 index.
Mirae Asset S&P 500 Top 50 ETF, an open-ended scheme, will track the S&P 500 Top 50 Total Return Index. The fund house also launched an NFO for a fund of funds that will invest in the ETF, enabling even those who don’t have a demat account to invest.
The NFO for both the funds opened for subscription today. While Mirae Asset S&P 500 Top 50 ETF will close on September 14, 2021, Mirae Asset S&P 500 Top 50 ETF Fund of Fund will close on September 15, 2021.
The S&P 500 Top 50 Index captures several well-known sector leading companies from IT to healthcare, financials to consumer, energy to communication etc, having a total market cap of over $23 trillion.
The top 10 constituents by index weight are Apple, Microsoft, Amazon, Facebook A class shares, Alphabet A and C class shares, Tesla, Nvidia, Berkshire Hathaway and JP Morgan Chase.
“These companies through a strong suite of products and services and zeal to innovate are setting benchmarks for others to follow. We have watched these companies grow over the years, establish their dominance and more often than not become part of our lives. Through Mirae Asset S&P 500 Top 50 ETF’ and the ‘Mirae Asset S&P 500 Top 50 ETF Fund of Fund’, investors may aim to participate in the growth story of these sector leadingmMega-cap companies,” said Swarup Mohanty, CEO, Mirae Asset.
In rupee terms, S&P 500 Top 50 index has outperformed Nifty 50 by more than 10 per cent in the last 10, 5, 3, 2 years period, respectively, said Mirae Asset.
Investing in the S&P 500 Top 50 Index will also allow Indian investors to benefit from rupee depreciation and help with diversification of country risk, the fund house argued.
According to the scheme information document, the total expense ratio (TER) for the ETF is up to 1 per cent, which makes it comparatively much more expensive than other passive funds that invest in US-based companies.
The minimum initial investment in both the schemes will be Rs 5,000 and multiples of Re 1 thereafter during the NFO.