MOTILAL OSWAL LAUNCHES NIFTY 500 MOMENTUM 50 INDEX FUND

Published on Sep 04, 2024 15:21

Motilal Oswal Mutual Fund has launched the "Motilal Oswal Nifty 500 Momentum 50 Index Fund." This fund will track the Nifty 500 Momentum 50 Index.

The new fund offer (NFO) commenced on September 2, 2024, and will conclude on September 16, 2024. Investors interested in participating can subscribe to the fund during this period.

The fund is open-ended, meaning it will continuously offer new units to investors. It aims to replicate the performance of the Nifty 500 Momentum 50 Total Return Index. The fund provides exposure to stocks that have exhibited strong momentum across the large, mid, and small-cap segments of the Nifty 500 Index.

The Nifty 500 Momentum 50 Index is a carefully curated benchmark that identifies the top 50 companies within the Nifty 500 based on their Normalised Momentum Score. This index adheres to a momentum investing strategy, which involves selecting stocks that have demonstrated recent outperformance. The underlying principle is that stocks performing well in the past are more likely to maintain their momentum in the near future.

The index construction process involves a rigorous evaluation of Nifty 500 stocks based on their price performance over the past 6 months and 1 year. Additionally, the 12-month volatility is adjusted to ensure a balanced approach. The top 50 stocks exhibiting the strongest momentum are then included in the index.

As of August 30, 2024, the Nifty 500 Momentum 50 Index has delivered impressive returns, registering a growth of 69.51% over the past year and 35.77% CAGR over the past five years. This historical performance underscores the potential benefits of investing in momentum-driven strategies.