Country's first IPO focused ETF, what is the expected return?
Mirae Asset Investment Managers (India) has recently launched Mirae Asset BSE Select IPO ETF and Fund of Fund (FOF), through which investors will get an opportunity to invest in newly listed companies. The new fund offer (NFO) for Mirae Asset BSE Select IPO ETF is open till march 5, 2025, while the NFO for Mirae Asset BSE Select IPO ETF Fund of Fund will remain open till march 11, 2025.
siddharth Srivastava, Head of ETF Product and Fund Manager at Mirae Asset Investment Managers (India), explained about the fund in an interview to CNBCTV-18, IPOs and spin-offs attract investors to invest in new companies that have normal growth prospects. However, there are many risks of investing in them. However, the portfolio not only helps to reduce these risks, but also shows a way to invest in new listings.
He further said, the purpose of such a fund is to provide a right way to invest through IPOs in fintech, auto, e-commerce, healthcare and many businesses of today's era. He further said, usually, newly listed companies are underrepresented in both passive and active funds. After the listing of these companies, they get the right exposure through the fund.
How different is it from other mutual funds?
Mirae Asset BSE Select IPO ETF and FOF will track those IPOs and spin-offs, which come in the top-500 companies according to market capital. siddharth Srivastava further said, to avoid market fluctuations, inclusion of new listings will be considered only after three months of listing. Apart from this, stock capping of 5 percent will be implemented for diversification and the stocks will remain in the index for 5 years.
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