Investors looking to invest in sectoral funds have a new scheme to invest in. ICICI Prudential Mutual Fund has launched an ETF for the FMCG sector and will invest in stocks tracking the NIFTY FMCG Index. The NIFTY FMCG Index comprises 15 stocks from the FMCG sector listed on the National Stock Exchange (NSE). The new fund offer (NFO) opened on July 20, 2021, and closes on August 02, 2021.
An ETF or an exchange traded fund, typically, tracks one specific index and thus investing in it means you end up buying all the stocks of the index in the same proportion as held in the index. What’s more, in an ETF you get the live prices as trading happens all through the market hours and the cost of owning them is considerably low.
Some of the key stocks of the FMCG sector are:
Tata Consumer Products Britannia Industries
Dabur India Godrej Consumer Products
Marico Jubilant Foodworks Colgate Palmolive (India)
United Spirits P&G Hygiene & Health Care
Emami Varun Beverages United Breweries
ICICI Prudential FMCG ETF will allow the investors to gain exposure to a diversified portfolio of companies in the consumer goods sector with a minimum investment of as low as Rs 1000. FMCG is the 4th largest sector in the Indian economy and the rural FMCG market is expected to grow 14% from 2020 to 2025.
ICICI Prudential FMCG ETF NFO is an open-ended Index ETF tracking the Nifty FMCG Index, comprising 15 stocks from the FMCG sector listed on the NSE. By investing in the fund one gets an exposure to leading companies forming part of the 4th largest sector in the Indian economy – FMCG.
Being a sectoral fund, the risks associated with any MF scheme having a concentrated exposure to any specific industry exists. In sectoral funds, one is required to keep track of the developments in the sector much more frequently, hence, a review may be required at frequent intervals. Invest in sectoral funds only if your risk profile allows with a long term objective.