UTI Nifty Bank ETF

About UTI Nifty Bank ETF

• UTI Nifty Bank ETF is an open-ended exchange-traded fund offered by UTI Mutual Fund House.
• The scheme was launched on September 1, 2020.
• UTI Nifty Bank ETF consists of top banking stocks listed on the National Stock Exchange.
• Shravan Kumar Goyal and Ayush Jain are the fund managers for this ETF.
• Like any other stock market transaction, a demat account is required to invest in UTI Nifty Bank ETF.
• Investors can place buy orders for the UTI Nifty Bank ETF through their brokers during the trading window of the NSE.

Investment Objective & Benchmark

• UTI Nifty Bank ETF aims to offer returns that replicate the performance of the underlying index, subject to minor tracking errors.
• The ETF is benchmarked against the Nifty Bank Index.
• The growth in the Indian economy has seen a surge in infrastructural spending, leading to increased borrowing. This spike in demand positions the banking sector for exponential growth.
• This ETF is a cost-effective way to make gains with the growth of the banking sector, allowing one to invest in top banking stocks in a single investment.
• With recent reforms and stringent checks, the sector has minimised the risk associated with regulatory issues.
• The ETF creates a balance of stocks from both the private and public sector lenders, offering greater diversification.

Asset Allocation & Portfolio Composition

• UTI Nifty Bank ETF invests heavily in equity, allocating 99.49% of the funds.
• The remaining 0.51% is invested in debt, and cash.
• The ETF has invested 99.49% of the funds in the financial sector and the remaining in others.
• The ETF has diversified its fund across market capitalisation – 67.22% to giant cap, 13.93% to large cap, and 14.87% to mid-cap companies. The remaining 3.98% of the funds are invested in small-cap firms.
• The top 10 company holdings in the UTI Nifty Bank ETF make up 99.64% of the asset allocation, as of June 2024.

Top 10 company holdings UTI Nifty Bank ETF along with their portfolio weightage:

• HDFC Bank Ltd- 29.26%
• ICICI Bank Ltd- 23.21%
• Axis Bank Ltd- 9.73%
• State Bank of India Ltd- 9.62%
• Kotak Mahindra Bank Ltd - 8.18%
• IndusInd Bank Ltd- 6.22%
• Bank of Baroda Lt- 3.17%
• Punjab National Bank - 2.47%
• AU Small Finance Ltd-2.34%
• Federal Bank Ltd - 2.33%

UTI Nifty Bank ETF has posted a return of 11.99% over the past year, as per data as oo June 30.

Since its inception in September 2020, the ETF has generated a return of 21.95% against the Nifty Bank TRI's 22.05%.