NFO opens on 04th October 2022 and closes on 17th October 2022
Mumbai, 04th October 2022: Tata Mutual Fund announces the launch of Tata Nifty Midcap 150 Momentum 50 Index Fund, an open-ended scheme replicating/tracking NIFTY Midcap 150 Momentum 50 Index. The New Fund Offer (NFO) opens on 04th October 2022 and will close on 17th October 2022.
Tata Nifty Midcap 150 Momentum 50 Index Fund aims to provide returns, before expenses, that commensurate with the performance of NIFTY Midcap 150 Momentum 50 Index (TRI), subject to tracking error. The fund will invest in securities covered by NIFTY Midcap 150 Momentum 50 Index with 95 per cent-100 per cent allocation, debt and money market instruments up to per cent allocation and will be benchmarked against NIFTY Midcap 150 Momentum 50 Index (TRI).
Commenting on the launch of the fund, Sailesh Jain, fund manager, Tata Asset Management, said, "Momentum strategy takes into consideration the past price performance of the stock over a defined period. We believe that price outperformance of a stock captures a lot of good around the stock, hence once a trend is well-established, it may be likely to continue. A carefully crafted investing strategy may provide the confidence necessary to continue with the methodology in all time frames of the market. Our cost-efficient offering through an Index Fund, makes an opportunity for long-term equity investors.”
Anand Vardarajan, business head- banking, Alternate Products and Product Strategy added, “Over the past five and 10 years, many mid-cap stocks have turned into multi-baggers. However, the midcap segment exhibits a large dispersion of returns, creating the need for a filter to select potential outperformers. This is where momentum investing comes in. The simple physics definition of momentum is that momentum equals mass*velocity. In fund parlance it will be stock weights*price performance adjusted for volatility. Midcap coupled with momentum as a filter has shown remarkable results and that is what we wish to replicate here. This can be a great addition to benefit from the opportunity in the midcap space and a differentiated approach of looking at momentum as a factor for selection. We look at the last six and 12-month price performance adjusted for volatility and free float (liquidity) to arrive at momentum.”
The exit load is 0.25 per cent of the applicable NAV, if redeemed on or before 90 days from the date of allotment. The minimum subscription amount is Rs5,000 per application and in multiples of Re1 thereafter. The minimum application amount is applicable for switch-ins as well.
