DSP Investment Managers Launches DSP Nifty Midcap 150 Quality 50 Index Fund; NFO closes July 29

DSP Investment Managers announced on Monday the launch of the DSP Nifty Midcap 150 Quality 50 index fund. This new mid-cap fund offers investors the opportunity to invest in mid-cap companies offering higher growth and profitability potential, a lower leverage and relatively stable earnings, the company said in its press release.

The new fund offering (NFO) which opened today will close on July 29, according to the company’s statement.

The DSP Nifty Midcap 150 Quality 50 Index Fund follows a rules-based zero-bias strategy by replicating the Nifty Midcap 150 Quality 50 Index.

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This index selects 50 companies from the parent Nifty Midcap 150 index based on “quality scores” using metrics such as return on equity, financial leverage (excluding financial services companies ) and the variability in earnings per share (EPS) growth of each stock.

Each stock’s weight in the index is based on a combination of its quality score and its free-float market capitalization.

The DSP Nifty Midcap 150 Quality 50 Index Fund is a passive fund. The company also claims to offer the program at a comparatively lower expense ratio than most actively managed mid-cap funds.

“The DSP Nifty Midcap 150 Quality 50 Index Fund selects the top 50 ranked companies based on the three most important quality metrics. The goal is to help investors build their mid-cap portfolio with a disciplined design to deliver long-term outperformance,” Anil Ghelani, CFA, Head – Passive and Product Investments, DSP Investment Managers.

“This is particularly important for those looking to invest in mid-cap stocks. The mid-cap space is known to have many stocks that have potential that is never realized – our data suggests that more than 4 medium size 5 in India never become market leaders, or blue chips – that’s when high returns can be unlocked,” he added.

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