The Kotak MNC Fund New Fund Offer NFO-2024

The Kotak MNC Fund New Fund Offer NFO-2024 is currently open for subscription and will close on October 21, 2024. The fund is designed to invest primarily in the equity and equity-related instruments of multinational companies (MNCs) listed in India. The objective of the scheme is to provide long-term capital growth by taking advantage of the performance of MNCs, known for their global reach, strong brand value, and financial stability.

Key Details:

NFO Period: The offer opened on October 6, 2024, and will close on October 21, 2024. Post this, the scheme will reopen for continuous subscription and redemption on or before October 31, 2024.
Initial NAV: The units are being offered at ₹10 per unit during the NFO.
Benchmark: The fund is benchmarked against the Nifty MNC Index TRI (Total Returns Index), which tracks the performance of the MNC sector in India.
Minimum Investment: You can start investing with as little as ₹100, with additional investments allowed in multiples of any amount thereafter.
Fund Managers: The fund is managed by a team including Harsha Upadhyaya, Dhananjay Tikariha, and Abhishek Bisen—experienced professionals in managing equity and sector-specific funds.
Asset Allocation:
- 80% to 100% will be allocated to the equity and equity-related instruments of MNCs.
- Up to 20% can be allocated to debt and money market instruments.
- A maximum of 10% can be invested in REITs and InvITs (Real Estate Investment Trusts and Infrastructure Investment Trusts).

Fees and Exit Load:

Exit Load: 1% if more than 10% of the units are redeemed or switched out within 1 year from the date of allotment.
Expense Ratio: There is no expense ratio during the NFO period, but it will be applicable once the scheme is listed for ongoing sales.

Risk and Taxation:

The Kotak MNC Fund is a very high-risk scheme due to its focus on a specific sector, increasing volatility and concentration risk.
Tax on short-term capital gains (STCG) for holding less than a year is 20%, while long-term capital gains (LTCG) for holding over a year are taxed at 12.5%

Who Should Invest:

This fund is suitable for investors looking for long-term capital growth and those with a high-risk appetite, aiming to capitalize on the performance of large, globally recognized multinational companies. However, due to its sector-specific nature, it is subject to higher volatility than more diversified mutual funds.

Investors should consult with a financial advisor to ensure that this fund aligns with their investment goals and risk tolerance.

Why this Kotak MNC Fund?

Investing in the Kotak MNC Fund might appeal to certain types of investors due to its specific focus on multinational corporations (MNCs), which are known for several strengths:

Strong Financial Stability: MNCs tend to have solid financial foundations, including strong balance sheets, diversified global operations, and high profitability. These factors can potentially offer better returns and stability during volatile market conditions.
Global Reach and Brand Value: MNCs operate in multiple countries, often with established global brands and large customer bases. This provides a cushion against downturns in any single economy and allows them to capitalize on growth in emerging markets.
Diversified Sector Exposure: MNCs span across industries such as pharmaceuticals, FMCG, technology, and automotive, offering investors diversified exposure within a focused portfolio. The fund aims to invest in a range of sectors through high-quality MNC stocks.
Potential for Growth: These companies often have the ability to leverage their global supply chains and innovation strategies, which can contribute to consistent long-term growth. The focus of the Kotak MNC Fund is to tap into this growth potential.
High-Risk, High-Return Potential: Since the fund is equity-focused and tied to a specific theme (MNCs), it carries high risk. However, investors with a long-term horizon and a high-risk appetite might find this appealing, given the potential for substantial capital growth.
Sector Performance: Historically, funds focused on MNCs have delivered competitive returns. For example, existing MNC funds like UTI MNC Fund and ICICI Prudential MNC Fund have seen returns over 30% in some years.

This fund could be suitable for investors who are looking to diversify into a specific category of high-quality, globally oriented companies, especially those seeking long-term capital appreciation in a portfolio with a high-risk tolerance.

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