NFO Alert: SBI Mutual Fund launches PSU Bank-based two passive funds

SBI Mutual Fund launched PSU Bank-based two new passive schemes: SBI BSE PSU Bank Index Fund and SBI BSE PSU Bank ETF. The new fund offer or NFO for both schemes is open for subscription and will close on March 20.

SBI BSE PSU Bank Index Fund is an open-ended scheme replicating/tracking the BSE PSU Bank Index, and the SBI BSE PSU Bank ETF is an open-ended exchange-traded fund replicating/tracking the BSE PSU Bank Index.

These open-ended schemes aim to replicate or track the performance of the BSE PSU Bank Index, offering investors an opportunity to participate in the growth of India’s public sector banking sector, according to a press release by the fund house.

The investment objective of both the SBI BSE PSU Bank Index Fund and the SBI BSE PSU Bank ETF is to provide returns that closely correspond to the total returns of the securities as represented by the underlying index, subject to tracking error.

The funds will primarily invest in securities covered by the BSE PSU Bank Index, with a minimum allocation of 95% to 100% of total assets. Additionally, they may allocate up to 5% in government securities, triparty repo, and units of liquid mutual funds to manage liquidity requirements.

The minimum investment amount during the NFO period is Rs 5,000, and in multiples of Re 1 thereafter, while the benchmark/underlying index will be the BSE PSU Bank TRI. The units of the SBI BSE PSU Bank ETF will be listed on NSE and BSE.

These funds are suitable for investors looking to benefit from the PSU banking sector’s performance, offering a structured way to invest in a diversified portfolio of leading public sector banks, the release said.

The fund manager for the SBI BSE PSU Bank Index Fund and the SBI BSE PSU Bank ETF will be Viral Chhadva.