SBI Mutual Fund's new fund offer to track 30 high-momentum stocks. Know this before investing

A new fund offer (NFO) of a passive fund from SBI Mutual Fund will invest in the top 30 high-momentum stocks across large and midcap companies, as reflected in the Nifty200 Momentum 30 Total Return Index (TRI).

Named SBI Nifty200 Momentum 30 Index Fund, the scheme's NFO period is closing on July 3, 2025.

The SBI Mutual Fund's NFO aims to provide returns corresponding to the total returns of the securities represented by the Nifty200 Momentum 30. However, returns are not guaranteed, and they would also be subject to tracking error.

If you are planning to invest in this NFO, the following are some key details that you should know.

What's the index?

Before investing in any passive or index fund, it is important to understand its underlying index. In this case, the benchmark index is the Nifty200 Momentum 30 Index. Let's understand what it is and its constituents.

The Nifty200 Momentum 30 Index tracks the performance of the top 30 high-momentum companies selected from the top 200 stocks by market cap.

According to NSE, these stocks are selected based on their "Normalised Momentum Score", which is determined based on a company's "6-month and 12-month price return, adjusted for its daily price return volatility."

Source: NSE

Source: NSE

Who may invest in this NFO?

The Scheme Information Document (SID) of the fund says, "The investment objective of the scheme is to provide returns that correspond to the total returns of the securities as represented by the underlying index, subject to tracking error."

"However, there is no guarantee or assurance that the investment objective of the scheme will be achieved," it adds.

The fund will invest a minimum of 95% of its assets in securities covered by the Nifty200 Momentum 30 Index while up to 5% will be invested in Government securities and liquid funds.

The SID says that after the closure of the NFO period, the funds may be deployed in government securities till the time full deployment is achieved.

The minimum application amount for this NFO is ₹5000 and in multiples of ₹1 thereafter. The fund will be managed by Viral Chhadva.

Should you invest?

Before investing in any NFO, you should check whether you need it or if it will add value to your investment portfolio. If you can't decide this on your own, then it would be better to consult a SEBI-approved financial advisor for guidance. And in any case, you should not rush to invest in a fund.