NFO review: ICICI Prudential NASDAQ 100 Index Fund
ICICI Prudential AMC is launching ICICI Prudential NASDAQ 100 Index Fund, which will invest in NASDAQ-100 giving exposure to 100 largest globally leading non-financial companies. The scheme offers exposure to big tech stocks and global companies listed on NASDAQ-100 via index based investing. The NFO opens September 27 and closes October 11. Read on to know more details.
Why Nasdaq 100
The NASDAQ 100 index offers a diversification opportunity away from financials-dominated indices such as India’s Nifty 50. The correlation between Nasdaq-100 TRI (including rupee depreciation benefit for Indian investors) and Indian equity indices such as Nifty 50 TRI is quite low. Financials has zero weight in Nasdaq-100.
NASDAQ-100 offer access to globally leading companies that maintain dominant positions in the market. With a market cap of $18 trillion, this index has outperformed broad market in US. The index has 44 per cent weightage in technology stocks.
The top 10 constituents of the index are Apple, Microsoft, Amazon, Alphabet (class C), Facebook, Tesla, Alphabet (Class A), NVIDIA, Paypal and Adobe. NASDAQ-100 has delivered 35 per cent CAGR in last 6 years. The NASDAQ-100 has outperformed the Nifty 50 six times over the last decade.
Why index fund
The NASDAQ 100 index fund offers 8 advantages
1) Diversification
2) NASDAQ-100 has performed well over the last 2 decades
3) Exposure to Big Tech stocks
4) Transparent and index based investing
5) Access to global companies listed on NASDAQ-100
6) Potential hedge against rupee depreciation vs dollar
7) Direct investment in index constituents
8) Global products & services catering to all age groups
Offering details
Plans/Options Plans – Regular and Direct
Options – Growth & Income Distribution cum Capital Withdrawal (IDCW) (Payout & Reinvestment)
Fund Manager – Priyanka Khandelwal
Minimum application amount – Rs 1000
Benchmark index – NASDAQ-100 INDEX® TRI
Daily, Weekly, Fortnightly, Monthly SIP
Existing Nasdaq 100 funds
The existing schemes linked to Nasdaq 100 are Kotak Nasdaq 100 FOF, Motilal Oswal NASDAQ 100 Exchange Traded Fund and Motilal Oswal Nasdaq 100 FOF.
ICICI Prudential NASDAQ 100 Index Fund is an index fund which means that investors will not require a demat account to buy or sell. ETFs require a demat account for transaction. Also, an index fund offers buy/sell NAV from AMC itself. In case of ETFs, the buying and selling happens on the stock exchange at the unit price.
Index funds also are cost effective. A fund of fund usually has the expense of the FoF and also of the underlying fund.
