NFO review: Kotak Midcap 50 ETF

It's been raining passive funds in the mutual fund industry for the last couple of quarters. There are 184 index funds and exchange-traded funds (ETFs) today, out of which 87 have been launched in the last three years (more than half of which came into being in 2021 alone). Kotak Mutual Fund has rolled out an ETF in the mid-cap space. The new fund offer (NFO) will close for subscription on January 20, 2022, after which it can be purchased and sold on the stock exchanges. Here are the key details of the new fund offer: About the strategy The newly-launched fund would be the first to mimic 'Nifty Midcap 50 TRI'. The latter comprises the top 50 stocks based on full market capitalisation from the Nifty Midcap 150 index (representing 150 companies ranked 101-250 as per full market capitalisation from the Nifty 500 Index). Thus the primary objective of this underlying index is to capture the movement of the midcap segment of the market. As this index captures the top 50 companies from the universe of Nifty Midcap 150, there are some subtle and not-so-subtle differences between the two indices. First, the top five sectors are broadly the same; however, their weightage in the Midcap 50 inde