Groww Mutual Fund has announced the launch of the Groww Nifty 500 Momentum 50 ETF, an open-ended scheme that tracks the Nifty 500 Momentum 50 Index - TRI.
The New Fund Offer (NFO) for the scheme is open for subscription and will close on April 17. The scheme will reopen for continuous sale and repurchase on May 5.
The scheme will be benchmarked against the Nifty 500 Momentum 50 Index TRI and will be managed by Nikhil Satam.
The investment objective of the scheme is to generate long-term capital growth by investing in securities of the Nifty 500 Momentum 50 Index in the same proportion/weightage, with the aim to provide returns before expenses that track the total return of the Nifty 500 Momentum 50 Index, subject to tracking errors.
The Nifty 500 Momentum 50 Index selects the top 50 companies from the Nifty 500 based on their momentum score, which is calculated using each company's 6-month and 12-month price returns, adjusted for volatility. The index is rebalanced semi-annually to stay updated with market changes, ensuring that it reflects the most promising stocks driving momentum in the market, according to a release from the fund house.
What is momentum investing?
Momentum investing involves purchasing stocks that are trending upward and selling them before the trend reverses. This strategy is based on the belief that stocks with upward momentum will continue to rise, driven by the herd mentality of market participants. The goal is to buy high and sell higher, focusing more on price movements than on company fundamentals.
Over various time periods, the Nifty 500 Momentum 50 Index has historically outperformed other broad market indices such as the Nifty 50 and Nifty 500, according to the release.
The Groww Nifty 500 Momentum 50 ETF may be suited for investors seeking a simpler way to implement momentum investing strategies, as the scheme follows a pre-determined logic and is auto-executed periodically without the need for complex algorithms, the release added.
The minimum investment amount is Rs 500, and in multiples of Re 1 thereafter.
The New Fund Offer (NFO) for the scheme is open for subscription and will close on April 17. The scheme will reopen for continuous sale and repurchase on May 5.
The scheme will be benchmarked against the Nifty 500 Momentum 50 Index TRI and will be managed by Nikhil Satam.
The investment objective of the scheme is to generate long-term capital growth by investing in securities of the Nifty 500 Momentum 50 Index in the same proportion/weightage, with the aim to provide returns before expenses that track the total return of the Nifty 500 Momentum 50 Index, subject to tracking errors.
The Nifty 500 Momentum 50 Index selects the top 50 companies from the Nifty 500 based on their momentum score, which is calculated using each company's 6-month and 12-month price returns, adjusted for volatility. The index is rebalanced semi-annually to stay updated with market changes, ensuring that it reflects the most promising stocks driving momentum in the market, according to a release from the fund house.
What is momentum investing?
Momentum investing involves purchasing stocks that are trending upward and selling them before the trend reverses. This strategy is based on the belief that stocks with upward momentum will continue to rise, driven by the herd mentality of market participants. The goal is to buy high and sell higher, focusing more on price movements than on company fundamentals.
Over various time periods, the Nifty 500 Momentum 50 Index has historically outperformed other broad market indices such as the Nifty 50 and Nifty 500, according to the release.
The Groww Nifty 500 Momentum 50 ETF may be suited for investors seeking a simpler way to implement momentum investing strategies, as the scheme follows a pre-determined logic and is auto-executed periodically without the need for complex algorithms, the release added.
The minimum investment amount is Rs 500, and in multiples of Re 1 thereafter.
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