NFO alert: ICICI Prudential floats BSE Liquid Rate ETF, Samco Asset Management introduces Samco Large Cap Fund; check details

ICICI Prudential Mutual Fund has launched a New Fund Offer (NFO) for the ICICI Prudential BSE Liquid Rate ETF - Growth. This open-ended exchange-traded fund (ETF) will be available for subscription starting March 5, 2025, and will close on March 10, 2025. As a passive investment vehicle, the ETF is designed to deliver returns that closely correspond to the BSE Liquid Rate Index, subject to permissible tracking errors. 

Investors can trade units on the stock exchanges without an exit load, although brokerage and other transaction costs may apply. The minimum subscription amount for this NFO is set at Rs 1,000, making it an accessible option for a wide range of investors seeking a low-risk avenue to park short-term funds.

The ETF provides an investment option with minimal deviation from its benchmark, the BSE Liquid Rate Index. Its structure ensures it remains largely in sync with the index it tracks, potentially offering stable returns reflective of the index's performance. 

The scheme provides investors with a secure and easily accessible option for investing short-term funds. Acting as a passive investment tool, the ETF follows the BSE Liquid Rate Index closely, minimising any divergence from the benchmark. Units can be traded on stock exchanges without any exit charges. Please note that brokerage fees and other transaction costs may be incurred.

By enabling transactions on stock exchanges without an exit load, the ETF offers significant flexibility and liquidity for investors. The passive nature means the ETF does not actively attempt to outperform the index but focuses on tracking it as closely as possible. 

Samco Large Cap Fund

In a similar timeframe, Samco Asset Management has introduced its own New Fund Offer for the Samco Large Cap Fund, opening on March 5, 2025, and closing on March 19, 2025. Unlike the ICICI ETF's focus on liquidity, the Samco Large Cap Fund invests at least 80% of its assets in large-cap equities and employs tactical hedging along with derivative strategies to manage market volatility. This fund is benchmarked against the Nifty 100 Total Returns Index (TRI), offering investors a different risk-return profile compared to the ICICI fund.

The Samco Large Cap Fund is structured to allow investors a minimum investment of Rs 5,000 for a lump sum contribution and Rs 500 for Systematic Investment Plans (SIPs), requiring at least 12 instalments. This contrasts with the ICICI ETF's lower entry point of Rs 1,000, designed to attract investors with varied risk appetites and investment horizons. Both funds present new entrants in their respective market segments, providing options catering to distinct financial strategies.

The introduction of these funds occurs within a competitive mutual fund landscape in India, where companies like Axis Mutual Fund have launched various index funds targeting both large-cap and mid-cap segments. With a focus on providing customised investment solutions, these funds are part of a broader trend in the financial services sector to offer diversified products that meet specific investor needs, such as liquidity, risk management, and long-term growth potential. As market dynamics evolve, both ICICI Prudential and Samco aim to capture investor interest through these strategic offerings.