Axis Mutual Fund, few days back, launched the value fund named as “ Axis Consumption ETF’. This new fund offer opened for subscription on August 30 and will end on September 13. Axis Mutual Fund, India’s fastest growing fund houses came up with this new fund that allows investors to have exposure to the consumption theme in exchange traded funds. The fund seeks to track returns by investing in a basket of NIFTY India Consumption Index stocks and aims to achieve returns of the stated index. These funds are intended for long-term wealth creation solutions and targets to achieve returns by investing in a basket of NIFTY India Consumption Index stocks.
“We at Axis AMC, strongly stand by being responsible fund house. We strive to provide our consumers with a basket of products that are potently driven by quality and are relevant in the current context giving long term returns. Through the launch of Axis Consumption ETF, we aim to provide our consumers with an investment option that has proof of growth & strong returns. The consumption market has remained strong, gained traction and grown consistently over the last few decades. Our investors are smart and are completely driven by data, it is important that we distinctly show the surge in passive investing. I believe Axis Consumption ETF is a good opportunity for investors to gain exposure as well as a steady and continued long-term growth in the market,” Chandresh Nigam, MD & CEO, Axis AMC said.
Simply put, an ETF is just like a stock and can be also called a basket of securities that also trade on the stock market. Exchange traded funds pool the financial resources of several people and use it to purchase various tradable monetary assets such as shares, debt securities such as bonds and derivatives. Most ETFs are registered with the Securities and Exchange Board of India (SEBI). It is an appealing option for investors with limited expertise in the stock market.
The minimum amount that is required for investing in this thematic fund is Rs. 5,000 and after that you can invest as much you want.
The fund house believes that India’s bright growth prospects for next ten years along with a massive digitisation programme, the consumption will scale new heights in the nation and is bound to rise exponentially. The byproduct of the rapid growth and increasing consumption is being reflected in the Nifty Consumption Index. The index comprises of a diversified grouping of companies across sectors like Consumer Non-durables, Healthcare, Auto, Telecom Services, Pharmaceuticals, Hotels, Media & entertainment, etc. that reflect the essence of consumption in India today across essentials and discretionary spending. The NIFTY India Consumption Index comprises the 30 largest consumption oriented companies by free float market capitalization.
One important thing that investors should know is the exit load. In this scheme, 1 per cent load will be charged for redemption within 365 days, if you will buy units in excess of 10 percent of investment.
As far as returns are concerned, the consumption theme has done well over the last decade. NICI has given 16.59 per cent returns over the last nine years compared to 15.39 per cent returns given by Nifty 50 TRI. In a low growth economy many investors opted to remain invested in high quality consumption businesses. In the last one year, consumer-focused funds have given returns of 49.5 per cent over the last one year, compared to 58.2 per cent returns delivered by large & mid-cap schemes.