Bandhan Nifty Smallcap 250 Index Fund - Direct Plan
The fund aims to replicate the Nifty Smallcap 250 Index by investing in the underlying securities in the same proportion, subject to tracking error.
Nifty Smallcap 250 represents the balance 250 companies (companies ranked 251-500) from Nifty 500.
What is a Nifty Smallcap 250 Index Fund?
Ever noticed a small company grow into a household name? The Nifty Smallcap 250 Index Fund gives you the opportunity to invest in 250 small-cap companies with significant growth potential. This open-ended index scheme tracks and replicates the Nifty Smallcap 250 Index.
The Bandhan Nifty Smallcap 250 Index Fund invests in 250 small-cap companies in India, identified by market capitalizations below ₹5,000 crore, aiming to capture the growth potential of these businesses.
The fund is required to invest at least 95% in stocks and index derivatives from the Nifty Smallcap 250 Index, with up to 5% allocated to debt and money market instruments. This setup allows investors to potentially benefit from the growth of small-cap companies.
The fund invests in small-cap companies across various sectors, providing some sectoral diversification. However, since it focuses on small-cap equities, it lacks diversification across market capitalizations and asset classes.
Nifty Smallcap 250 index mutual funds track the Nifty Smallcap 250 Index to replicate its returns. While it is subject to risks like tracking errors and market volatility, it offers potential long-term benefits due to the growth potential of small-cap companies. This fund is less prone to biases or active management errors.
Capital gains on Nifty Smallcap 250 Index funds are taxed based on the holding period. Units held for less than one year incur Short-Term Capital Gains Tax (STCG) at 15%. Gains exceeding ₹1,00,000 held for over a year are subject to Long-Term Capital Gains Tax (LTCG) at 10%. Dividends are added to the investor's income and taxed as per the applicable income tax slab.
- Min Investment 1,000
- Min SIP Amount 100
- Exit Load
Nil
This scheme has not completed one year.
Tier 1 Benchmark : Nifty Smallcap 250 IndexAlternate Benchmark :
- Performance
- Portfolio
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This fund is managed by Mr. Nemish Sheth (w.e.f 22/12/2023)
View fund performance of other funds managed by Mr. Nemish Sheth
Past performance may or may not be sustained in future.
Regular and Direct Plans have different expense structure. Direct Plan shall have a lower expense ratio excluding distribution expenses, commission expenses etc.
Taxation:
For taxation, please refer the link : https://bit.ly/46xQzi1
Bandhan Nifty Smallcap 250 Index Fund
(Scheme Risk-o-meter)
Nifty Smallcap 250 Index
(Tier 1 Benchmark Risk-o-meter)
This product is suitable for investors who are seeking*:
• To create wealth over long term
• Investment in equity and equity related instruments belonging to Nifty Smallcap 250 Index
Who Should Invest in a Nifty Smallcap 250 Index Fund?
Index funds like the Nifty Smallcap 250 follow a passive investment strategy, typically resulting in lower expense ratios. This fund is suitable for investors looking to passively track the Nifty Smallcap 250 Index while potentially benefiting from a low-cost investment option.
The Bandhan Nifty Smallcap 250 Index Fund invests primarily in small-cap stocks, making it highly vulnerable to market volatility. This high-risk fund is suitable for investors with a high-risk tolerance and a long-term investment horizon.
Small-cap companies have significant growth potential but are vulnerable to market volatility. By holding Nifty Smallcap 250 index mutual funds for the long term, investors can ride out short-term fluctuations and potentially achieve substantial wealth creation.
FAQs on Nifty Smallcap 250 Index Fund
What does a Nifty Smallcap 250 Index Fund invest in?
A Nifty Smallcap 250 Index Fund is mandated to invest at least 95% of its corpus in stocks and index derivatives of companies present in the Nifty Smallcap 250 index. The fund may invest 5% of its corpus in debt and money market instruments.
What is the eligibility criteria for Nifty Smallcap 250 index?
The company's present in the Nifty Smallcap 250 index are small cap companies, determined by their market capitalisation. They have a market capitalisation below ₹5,000 crore. These companies are ranked from 251-500 on the NSE.
Are Nifty Smallcap 250 Index mutual funds risky investments?
Yes, Nifty Smallcap 250 Index funds are a very high-risk investment as they primarily invest in small cap companies. They may be vulnerable to market volatility and fluctuations. Moreover, as an index fund, this scheme may be subject to tracking errors.
Are Nifty Smallcap 250 index mutual funds suitable for wealth creation?
Nifty Smallcap 250 index funds aim to potentially create wealth in the long-run. Small cap companies may have greater growth potential, however they may be affected by market fluctuations. Investing in these schemes in the long-run may help ride out volatility.
Is Bandhan Nifty Smallcap 250 index fund suitable for diversification?
Bandhan Nifty Smallcap 250 index fund invests in companies present in the index it is tracking. This may allow investors to diversify their portfolio across sectors. However, these are all small cap companies; investors cannot gain the potential benefits of diversification across market capitalisation.
How to invest in Bandhan Nifty Smallcap 250 Index Fund?
To invest in Bandhan Nifty Smallcap 250 Index fund click the “Invest Now” button. Fill in the required information and complete the KYC.