Zerodha's multi-asset passive fund open for subscription: Should you invest?
What's the story
Zerodha has launched the Zerodha Multi Asset Passive Fund of Fund (FoF), an open-ended scheme which invests in equity, debt index funds, and commodity exchange-traded funds (ETFs). The new fund offer (NFO) is now open for subscription in India. The fund combines four asset classes into one product: Large Cap Equity, Mid Cap Equity, Gold, and Government Securities (G-secs). So, should you invest? Let's have a look.
Investment strategy
Fixed allocation to 4 asset classes
The fund has a fixed allocation of 30% each to a Large Cap ETF tracking the top 100 companies and a Mid Cap ETF tracking the next 150 companies. It also invests around 25% in a Gold ETF and 15% in a G-sec ETF. The portfolio is internally rebalanced at regular intervals, with no tax implications for the investors during these adjustments. Tax is only applicable when units are redeemed.
Accessibility
NFO price is ₹100 per unit
The minimum investment during the NFO period (till August 8) is ₹100, with further investments allowed in multiples of ₹100. The fund can be accessed on all major mutual fund platforms. Vishal Jain, CEO of Zerodha Fund House, said this fund is "a great option for anyone who wants a simple but diversified portfolio."
Simplified investing
Fund takes 'guesswork out of asset allocation'
Vaibhav Jalan, Chief Business Officer of Zerodha Fund House, said the fund takes "the guesswork out of asset allocation." He added it provides "easy access to multiple asset classes in one product." The launch of this fund is a step toward simplifying the investment process for retail investors, by providing them with a diversified portfolio option at an affordable entry point.