HDFC Nifty NEXT 50 ETF

About HDFC Nifty Next 50 ETF

• The HDFC Nifty Next 50 ETF is an open-ended scheme offered by the HDFC Mutual Fund house.
• The ETF invests in stocks in line to join the Nifty 50 Index constituents.
• The inception date of the HDFC Nifty Next 50 ETF is August 5, 2022.
• The total assets under management (AUM) for the ETF stood at ₹39.59 crore as of June 30, 2024.
• Arun Agarwal has been managing the fund since August 5, 2022. Abhishek Mor joined the fund management team on February 15, 2023.
• One can invest in the scheme by directly buying the ETF units using their demat account with a registered broker.
• The ETF units can be bought and sold at the prevailing price during the usual market hours.

Investment Objective and Benchmark

• The benchmark for the HDFC Nifty Next 50 ETF is the NIFTY Next 50 Total Returns Index (TRI).
• The ETF’s investment goal is to deliver returns on investments that roughly match the total returns of the securities as represented by the NIFTY Next 50 Index.
• The Nifty Next 50 Index includes the next 50 large-cap and liquid stocks that follow the Nifty 50, typically ranking between the 51st and 100th positions by market capitalisation.
• As a popular benchmark for exchange-traded products in India, the Nifty Next 50 Index offers investors exposure to the growth potential of these 50 large-cap companies.
• By investing in the HDFC Nifty Next 50 ETF, investors can gain exposure to India’s next 50 large-cap companies that follow the Nifty 50.
• This ETF offers diversified large-cap exposure, providing access to a broad portfolio of large-cap stocks across various sectors which helps spread investment risk and may enhance risk-adjusted returns.
• The ideal investment horizon of the HDFC Nifty Next 50 ETF is at least three years, which means it’s suitable for those who have a time horizon of three years or more.
• In terms of the risk factor, the HDFC Nifty Next 50 ETF falls under the category of very high risk level of funds.

Asset Allocation and Portfolio Composition

• The fund’s asset allocation is focused on securities covered by the Nifty Next 50 Total Returns Index (TRI), with indicative allocations ranging from 95% to 100% of the total assets.
• The fund may allocate between 0% and 5% to debt securities, money market instruments and units of debt schemes of mutual funds.
• The scheme invests in funds across market capitalisation.

Sector-wise allocation of funds:

• Financial - 18.58%
• Capital Goods - 17.84%
• Services - 15.45%
• Energy - 10.74%
• Consumer Staples - 10.07%
• Others - 27.32%

The top 10 company holdings constitute 39.81% The top 10 holdings of the HDFC Nifty Next 50 ETF as of June 30, 2024, and their portfolio weights in percentage, are:

• Trent: 5.54%
• Bharat Electronics: 5.03%
• Hindustan Aeronautics Limited: 4.52%
• The Tata Power Company Ltd: 3.42%
• Power Finance Corporation: 3.23%
• InterGlobe Aviation: 3.21%
• Siemens: 3.15%
• REC: 2.98%
• Vedanta: 2.94%
• Indian Oil Corporation: 2.79%

As of June 28, 2024, the scheme has returned 64.16% in the past year compared to the benchmark returns of 64.57%.

Since its inception, the HDFC Nifty Next 50 ETF has delivered annualised returns of 33.19%.