Axis Nifty ETF Everything You Need To Know

ETFs have gained popularity among investors as they offer unique benefits distinct from the perks of typical mutual funds. Exchange traded funds or ETFs are a basket of securities that mimic the performance of their underlying benchmark to generate capital appreciation. The underlying benchmark can be an index, precious metal, currency, sector, etc. ETFs work just like company stocks as investors can trade with their ETF units at the exchange(s) during live trading hours. Unlike other mutual funds whose units can be bought or sold only once, investors can trade ETF units at their current market price throughout the day.

Exchange Traded Funds (ETF), are mutual funds that trade like stocks. Like stocks, ETF units are traded on exchanges on which they are listed at market-determined prices and are bought and sold at any moment during market hours through demat accounts. The most common ETFs are designed to track the performance of a market benchmark or index’s total return.

What is a NIFTY exchange traded fund?

NIFTY is a market index introduced by the National Stock Exchange. The word NIFTY is an amalgamation of National Stock Exchange and Fifty. NIFTY 50 is a benchmark based index that consists of the top 50 stocks that are traded at this exchange.

A NIFTY ETF is an exchange traded fund whose portfolio tracks the composition of NIFTY 50 which is the underlying benchmark. The investment objective of a NIFTY ETF is to mimic the performance of its underlying benchmark by investing in the underlying securities in the same proportion as they are in the index.

Axis NIFTY ETF – An ETF scheme by Axis Mutual Fund

Axis NIFTY ETF is an open-ended Scheme replicating / tracking the NIFTY 50 Index. The investment objective of Axis NIFTY ETF is to provide returns before expenses that closely correspond to the total returns of the Nifty 50 Index subject to tracking errors. However, there is no assurance or guarantee that the investment objective of the Scheme will be achieved.

Benefits of investing in Axis NIFTY ETF

Diversification - Axis NIFTY ETF holds a basket of securities corresponding to the NIFTY 50 index.

Passive fund management - You don't have to keep track of every single investment your ETF owns. The fund manager ensures that the portfolio resembles the benchmark index with minimal tracking error.

Low Cost of acquisition - Can be purchased in multiples of 1 unit on listed stock exchanges.

Tax Efficiency - Equity ETFs are treated as equity oriented funds for the purpose of taxation.

Trading flexibility - Axis NIFTY ETF offers you the same intra-day pricing you get when trading stocks through a broker.

Liquidity offered by the scheme

On the exchange - The Units of the Scheme are listed on the National Stock Exchange of India Ltd. (NSE) and / or any other recognized stock exchanges as may be decided by the AMC from time to time. The Units of the Scheme may be bought or sold on all trading days at the prevailing listed price on such Stock Exchange(s).

Directly with the Mutual Fund – The Scheme offers units for subscription / redemption directly with the Mutual Fund in ‘Creation Unit’ size to Authorized Participants / Large Investors, at NAV based prices on all Business Days during an ongoing offer period. The redemption consideration shall normally be the basket of securities represented by the NIFTY 50 Index in the same weightage as in the Index and cash component.

Payment of Redemption Process

Payment of Redemption Proceeds: The AMC shall dispatch the Redemption proceeds within 10 Business Days from the date of receipt of request from the unit holder. Redemption proceeds in the form of baskets of securities included in NIFTY 50 Index in the same proportion will be credited to the designated DP account of the Authorized Participants / Large Investors. Any fractions in the number of securities transferable to Authorized Participants / Large Investors will be rounded off to the nearest lower integer and the value of the fraction will be added to the cash component payable. The cash component of the proceeds at applicable NAV will be paid by way of cheque or direct credit or through electronic mode i.e. RTGS / NEFT. However, only Authorized Participants and Large Investors can directly redeem from the AMC in 'Creation Unit’ size.

Entry / Exit Load

There is no entry load for Axis NIFTY ETF. The exit load on Axis NIFTY ETF is nil.

Retail investors are advised to seek professional guidance before investing in any investment scheme. Investments in mutual funds and exchange traded funds do not guarantee capital appreciation. Investors may only consider investing if their risk appetite allows them to do so.

Axis NIFTY ETF
An open ended Scheme replicating / tracking Nifty 50 Index

Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.