Question 1

What is Tata Nifty Financial Services Index Fund?

Accepted Answer

Tata Nifty Financial Services Index Fund is an open-ended index fund that aims to replicate the performance of the Nifty Financial Services Index (TRI). The fund invests in a basket of financial sector companies that are constituents of this index, offering investors exposure to leading banks, NBFCs, insurance companies, and other financial service providers.

Question 2

What is the Nifty Financial Services Index?

Accepted Answer

The Nifty Financial Services Index is a benchmark index comprising large, liquid, and prominent companies from the Indian financial services sector. It includes banks, financial institutions, housing finance, insurance, and other financial services companies, offering a comprehensive representation of the sector's performance.

Question 3

Is Tata Nifty Financial Services Index Fund a good investment for long term?

Accepted Answer

As an index fund, it can be suitable for long-term investors who are positive about the growth prospects of India's financial sector. Historically, financial services have been a key driver of economic growth, but investors should be comfortable with sector-specific risks.

Question 4

How does this index fund invest in the financial sector?

Accepted Answer

The fund passively invests in the same proportion and stocks as represented by the Nifty Financial Services Index. This means it automatically tracks and mirrors the index, maintaining a portfolio that reflects the sector's movement.

Question 5

What are the features of Tata Nifty Financial Services Index Fund?

Accepted Answer

The features of Tata Nifty Financial Services Index Fund include:

Passive fund that tracks the Nifty Financial Services Index (TRI)
Exposure to different companies within the financial services sector
Lower expense ratio compared to actively managed funds
Transparent and rule-based investment approach
Suitable for investors seeking financial services sector allocation

Question 6

Who should consider investing in this fund?

Accepted Answer

Investors who wish to capitalize on the potential of the financial sector and are comfortable with sector concentration risk can consider this fund. It's suitable for those with a long-term investment horizon looking for passive exposure to financial services.

Question 7

What are the risks of investing in a financial sector index fund?

Accepted Answer

The risks of investing in a financial sector index fund include:

Sector concentration risk: Performance is tied to the financial sector, making the fund vulnerable to sector-specific downturns.
Market risk: As with all equity investments, the fund is subject to overall market movements.
Regulatory risk: Changes in banking and financial regulation can impact fund performance.

Question 8

How does it differ from an actively managed BFSI fund?

Accepted Answer

An index fund like Tata Nifty Financial Services Index Fund passively tracks the benchmark index and does not rely on the fund managers discretion for stock selection. Actively managed BFSI funds allow fund managers to select and weight stocks based on research and market outlook, but at a higher cost compared to a passively managed fund.

Question 9

How can I start SIP in Tata Nifty Financial Services Index Fund?

Accepted Answer

You can start a Systematic Investment Plan (SIP) in this fund through the Tata Mutual Fund website, app, or via registered mutual fund distributors. Choose the amount and frequency, complete the KYC process if not already done, and register your SIP mandate online or offline.

Question 10

What is the benchmark of Tata Nifty Financial Services Index Fund?

Accepted Answer

The fund benchmarks itself against the Nifty Financial Services Total Return Index (TRI), which includes the same constituents as the Nifty Financial Services Price Index but also accounts for dividends received from the stocks in the index.

Key Measures**	Fund	Benchmark
Standard Deviation
Sharp Ratio
Portfolio Beta
R Squared
Treynor
Jenson

Portfolio Macauley Duration
Modified Duration
Average Maturity
YTM*	NA

				Current value of ₹10,000 invested
	Annualized (%)	Nifty Financial Services TRIBenchmark(%)	Nifty 50 TRIAdditional Benchmark(%)	Scheme	Nifty Financial Services TRIBenchmark(%)	Nifty 50 TRIAdditional Benchmark(%)
Since Inception	14.64%	15.96%	8.25%	₹12,013	₹12,200	₹11,123
Last 5 Years	NA	NA	NA	NA	NA	NA
Last 3 Years	NA	NA	NA	NA	NA	NA
Last 1 Year	8.30%	9.26%	-2.01%	₹10,827	₹10,924	₹9,799

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