The index fund is an open-ended scheme replicating the Nifty 200 Momentum 30 Index. The Nifty200 Momentum 30 Index consists of 30 companies selected from the Nifty 200 index based on their normalized momentum score.
“ICICI Prudential Nifty200 Momentum 30 ETF and ICICI Prudential Nifty 200 Momentum 30 Index Fund are the newest addition to our product bouquet. Both the offerings allow investors to capitalize on market trends by investing in stocks that have shown upward price momentum. The index comprises 30 stocks selected from Nifty 200 universe based on a combination of the stock’s Momentum Score and free-float market capitalization. Investors looking to invest in a Momentum based factor may consider investing in this scheme for long term”. The units of the ETF scheme will be listed on the BSE and NSE,” said Chintan Haria, Head- Product Development & Strategy, ICICI Prudential AMC.
According to the fund house, the scheme offers an opportunity to diversify equity investments across various sectors through 30 stocks selected from Nifty 200 Universe. It also reduces subjective biases by adding winners and removing laggards based on well-defined processes.
The scheme will follow the momentum strategy of investing. The strategy aims to capitalize on the continuance of existing trends in the market. It follows certain risk management rules to address volatility and other hidden traps that reduce profits. The strategy involves a strict set of rules based on technical indicators that dictate market entry and exit points for particular securities.
In terms of portfolio, the Nifty 200 Momentum 30 index is overweight on some of the fast-growing high momentum stocks from the sectors like Metals, Consumer Services, Chemicals, Power and Capital Goods.