HDFC Banking & Financial Services Fund: NFO closes on June 25 2021

The latest NFO from HDFC Asset Management is a mutual fund that invests in banking and financial service companies. Here, we bring you the details.

Good to know What is a sectoral fund? Sectoral funds only invest in businesses from a particular sector or industry. They offer investors an option to take advantage of a cyclical upswing in a sector. While these funds have the potential to give high returns, they can also be volatile.

Investment objective

The fund aims to invest in companies from the banking and financial services space including banks, brokerages, asset management, wealth management, insurance and non-banking finance companies.

The companies from the banking and financial services will be the biggest beneficiaries of macro tailwinds and new trends. This sector, therefore, offers investors a lucrative opportunity to benefit from a rebound in India’s economic growth, low-interest rates and rapid adoption of technology.

Currently, there are 110 listed companies in this sector and there is also potential for more new listings. Along with the promise of strong growth possibility, the sector also offers depth and diversity to investors.

Asset allocation

Types of Instruments	Indicative allocation (% of total assets)		Risk Profile
Equity and equity related instruments of Banking and Financial Services companies	80	100	Medium to High
Equity and equity related instruments of other than above	0	20	Medium to High
Non-convertible preference shares	0	10	Low to Medium
Units of REITs and InvITs	0	10	Medium to High
Debt securities, money market instruments and fixed income derivatives	0	20	Low to Medium

Scheme details

Name	HDFC Banking & Financial Services Fund
Type	An open-ended equity scheme investing in Banking & Financial Services Sector
Category	Equity Scheme-Sectoral
Benchmark	Nifty Financial Services TRI (Total Return Index)
Plans	Direct and Regular
Options	Growth and payout of income distribution cum capital withdrawal and Reinvestment of income distribution cum capital withdrawal
Entry/exit load	Entry Load: N.A. Exit Load: Redemption on or before 365 days from the date of allotment: up to 1% Redemption after 365 days from the date of allotment-NIL
Fund Manager	Anand Laddha
Minimum application amount	₹5,000/ and any amount thereafter
Additional application amount	₹1000/ and any amount thereafter
Expense ratio	Up to 2.25%

Riskometer

This product is suitable for investors who are seeking* Capital appreciation over the long term. An equity scheme that invests in equity and equity related instruments of Banking & Financial Services Sector.

*Investors should consult their financial advisors if in doubt about whether the product is suitable for them.

Note: The above information has been sourced from the Scheme Information Document provided by HDFC Asset Management Limited. To read the entire document, click here.

Disclaimer: The above article is purely academic in nature and aims to provide knowledge about basic trading concepts & should not be construed as an opinion or advice to invest or trade. RKSV Securities India Private Limited (brand name Upstox) is the distributor of the mutual fund.

Mutual fund investments are subject to market risks; please read all the related documents and/or consult your investment advisor before investing. Past performance of an investment asset does not guarantee future returns.