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ICICI Prudential Bank ETF Pubic Issue (NFO) Review

Published on Wednesday, July 3, 2019 by Dilip Davda

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ICICI Prudential Bank ETF Pubic Issue (NFO) Review

Bank ETF Key Highlights

  • Bank ETF are fancied by investors as Bank Nifty is the most followed indices.
  • This is the first Bank ETF from ICICI Prudential MF.
  • Bank ETFs has provided better long term rewards so far.
  • Bank ETF will be tracking Bank Nifty

Preface

ETFs are generally passively managed mutual fund schemes tracking a benchmark index and reflect the performance of that index. The types of ETFs are as under:

  • Equity ETFs
  • Debt ETFs
  • Commodity ETFs

In India, ETF schemes were approved in the year 2001 and we marked first ETF scheme NiftyBEES in December 2001. Since then we have seen many ETF schemes underlying various sectoral benchmarks with prime focus on main benchmarks like Nifty and Bank Nifty. Most of the ETFs so far are launched that are tracking NSE Indices.

While we have seen grand success of PSU ETFs like CPSE, Bharat 22, Finance ministry has approved PSU Bank ETF which is expected to hit the market very soon.

In the meanwhile, we have seen few ETFs underlying banking sector or banking indices. Some of them are Kotak Banking ETF, SBI ETF Banking, Kotak PSU Bank ETF, Reliance ETF Bank BeES, Reliance ETF PSU Bank BeES.

Growth of ETFs in India has seen CAGR of 60% in last decade.

Now we have a new fund offering from ICICI Prudential Bank ETF – an open-ended exchange traded fund tracking Nifty Bank Index. Details of this offer are as under:


ICICI Pru Bank ETF Detail

NFO Period

July 03, 2019 to July 08, 2019

RTGS & Transfer Cheques

Till end of business hours on July 08, 2019

Switches

Switches are not allowed

Minimum Application Amount during the NFO

Rs 5,000 (plus in multiple of Rs 1 thereafter)

Benchmark

Nifty Bank Index

Fund Manager

Kayzad Eghlim

Basket size

10,000 units. (Approx Rs.30,52,000)

Listing

NSE & BSE

As banking sector is considered as a lifeline for modern economy and is dominating with most popular Bank Nifty, NSE Bank Nifty represents 12 most liquid and large cap bank stocks that includes HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, SBI, IndusInd Bank, RBL Bank, Federal Bank, Yes Bank, Bank Of Baroda, IDFC First Bank and PNB. Bank Nifty has outperformed broad market indices over the long run.

Currently banking sector is in consolidation phase and thus provides ample opportunities for growth. Bank ETF provides access to invest in major banks with a minimum investment of 1 unit of Bank ETF.

ICICI Pru Bank ETF opens for subscription on 03.07.19 and will close on 08.07.19. Minimum application is to be made for Rs. 5000 and in multiple of Re. 1 thereon, thereafter. This scheme will have Nifty Bank Index as its benchmark. Under this scheme 10000 units (having approx. portfolio value of Rs. 3052000 as on 18.06.19.) are on offer. This scheme is brought by ICICI Prudential Mutual Fund. It does not allow switch over option.

Investors looking for long term rewards may consider investment in this offer. (Subscribe for long term).

For the information of investors we are giving below the performance of Bank Nifty


Risk Profile

ICICI Prudential Bank ETF is suitable for investors who are seeking Long term wealth creation.

An Exchange Traded Fund that aims to provide returns that closely correspond to the returns provided by Nifty Bank Index.

Riskometer

Returns by Bank NIFTY over various time periods

Index

Nifty Bank Index

Nifty 50 Index

Nifty 500 Index

Period

Returns

(%)

Risk Adjusted Returns

Returns

(%)

Risk Adjusted Returns

Returns

(%)

Risk Adjusted Returns

1 Year

15.1%

0.96

9.6%

0.72

3.7%

0.27

3 Year

20.3%

1.37

14.1%

1.21

13.1%

1.07

5 Year

15.7%

0.88

10.5%

0.79

10.8%

0.79

7 Year

18.0%

0.88

13.9%

0.99

14.4%

1.03

10 Year

16.4%

0.74

11.8%

0.74

12.0%

0.77

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6 Comments

avatar
6. Ammubutter  Jul 12, 2019 13:23 Reply
Is it listed?shares showing in NSDL
avatar
5. Sonal patel  Jul 10, 2019 21:33 Reply
Any news about listing date...
avatar
4. Ammubutter  Jul 6, 2019 09:14 Reply
1 unit will be how much?
avatar
4.1. Nirav  Jul 8, 2019 00:52
If U want to invest in this ETF than better to invest in directly Heveyweight Bank share.. Like HDFC BANK, AXIS BANK, KOTAK BANK., etc..
avatar
3. Nirav  Jul 5, 2019 22:54 Reply
No Discount..
avatar
2. ammubutter  Jul 5, 2019 15:21 Reply
Any discount for retailers?
avatar
1. VKMC  Jul 3, 2019 19:46 Reply
Is this similar to CPSE ETF / Bharat 22 ETFs? Are there any discount to retail investors?



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