Motilal Oswal Nifty Bank Index Fund - Direct Plan: Overview, Performance, Portfolio | Mutual Fund | Value Research (2024)

Returns

Risk

This fund has Very High risk.

Portfolio of Motilal Oswal Nifty Bank Index Fund - Direct Plan

Peer Comparison

Other details of Motilal Oswal Nifty Bank Index Fund - Direct Plan

Investment Strategy

The Scheme seeks investment return that corresponds to the performance of Nifty Bank Index subject to tracking error.

Suitability

This is a fund that invests mainly in shares of banks and financial services companies.

We believe that investors should avoid funds that have a narrowly defined investment mandate such as this one. Instead, they should invest in flexi-cap funds which provide complete freedom to the fund management team to invest in companies from which it expects maximum gains.

But if you do invest, you must do so only through the SIP route. Click here to read a primer on SIP investing.

Warning: Do not invest in this, or any other banking sector fund, if you need to redeem your investment in less than seven years.

Capital Gains Taxation

• If the mutual fund units are sold after 1 year from the date of investment, gains upto Rs 1.25 lakh in a financial year are exempt from tax. Gains over Rs 1.25 lakh are taxed at the rate of 12.5%.
• If the mutual fund units are sold within 1 year from the date of investment, entire amount of gain is taxed at the rate of 20%.
• No tax is to be paid as long as you continue to hold the units.

Dividend Taxation

• Dividends are added to the income of the investors and taxed according to their respective tax slabs. Further, if an investor's dividend income exceeds Rs. 5,000 in a financial year, the fund house also deducts a TDS of 10% before distributing the dividend.