NFO update: Baroda BNP Paribas MF launches Baroda BNP Paribas Nifty Midcap 150 Index Fund. Check details

Baroda BNP Paribas Mutual Fund has introduced Baroda BNP Paribas Nifty Midcap 150 Index Fund, which is an open-ended fund designed to mirror the performance of the Nifty Midcap 150 Total Return Index. The NFO for the Baroda BNP Paribas Mutual Fund opened for subscription on October 14, 2024, and will close on October 28, 2024.

Investors of this fund will have the opportunity to diversify their portfolio with exposure to sectors such as capital goods, chemicals, real estate, and textiles, which are either underrepresented or absent in the Nifty 50 Index, as per the company's analysis.

Top points

> The scheme aims to closely mirror the investment returns of the Nifty Midcap 150 Total Returns Index, factoring in expenses, tracking errors, fees, and other costs. It is important to note that while this is the objective of the Scheme, there is no guarantee of its achievement.

> The Nifty Midcap 150 Index Fund has demonstrated a track record of strong performance, outperforming its benchmark index. 

> An investment in the Nifty Midcap 150 TRI since April 2005 would have grown nearly 28 times, with a compound annual growth rate of 18.7% per year.

> The fund is also a feasible option for starting Systematic Investment Plans (SIPs). 

> A Rs 10,000 monthly SIP in the Nifty Midcap 150 TRI over the past 15 years would now be worth over Rs 1 crore, demonstrating the potential for wealth creation through regular investing.

> One key advantage of the Baroda BNP Paribas Nifty Midcap 150 Index Fund is the historically proven ability of its benchmark index, to deliver strong performance. An investment in the Nifty Midcap 150 TRI since April 2005 would have multiplied nearly 28 times1at a CAGR of 18.7% pa.

> Investors seeking diversification, exposure to emerging growth sectors, and the potential for long-term wealth generation may consider the Baroda BNP Paribas Nifty Midcap 150 Index Fund. 

> As a cost-effective and passively managed investment vehicle, this fund allows investors to tap into the growth potential of India's dynamic midcap segment, the MF house said.

"According to the S&P Indices vs Active Report, 75% of mid/small-cap funds have underperformed their benchmarks over the last 10 years. Our NFO offers a low-cost, passive investment solution that aims to mirror the performance of the Nifty Midcap 150 Index, reducing the risk of underperformance and seeking to provide a better opportunity for growth," said Suresh Soni, CEO, Baroda BNP Paribas Asset Management India Pvt Ltd.

"Given the inherently high growth rate of underlying companies, wider stock and sector selection and opportunities of re-rating, we expect the Nifty Midcap 150 index to deliver higher returns compared to large cap indices. Our research shows that the Nifty Midcap 150 TRI has generated 10% or higher compounded annual returns 94% of the time, when investors stayed invested for 10 years. Over any 10-year period, there have been zero instances of negative returns," Soni added.