Is it the time to reerse the capital money flow? Looks like so.
The general concept for majority of the foreign investors from devloped market is to look for investment opportunities in the so called "Emerging Markets". However, the performance of the emerging markets have been in question recently. With the countries like USA out of recession post the 2008 era, the investors now look at these so called developed markets as well for good returns on their investments.
Investors in India however still dont have much options to invest in devloped market specific stocks, mutual funds or other assets. So, to fill this gap, the Motilal Oswal Asset Management company has come out with its ETF or Exchange Traded fund called Motilal Oswal Most Shares NASDAQ-100 ETF, which will allow investors to take exposure in the NASDAQ 100 stocks index and being an ETF it will offer traders as well as investors real time trading opportunity.
In this article, we will analyse how good is this Motilal Oswal Most Shares NASDAQ-100 Fund NFO, whether this Motilal Oswal Most Shares NASDAQ-100 Fund offers anything new or unique for the investors and whether the investors should invest in Motilal Oswal Most Shares NASDAQ-100 Fund.
Motilal Oswal Most Shares NASDAQ-100 Fund NFO: Review Analysis & Details
Let's begin with some basic details about Motilal Oswal Most Shares NASDAQ-100 Fund.What are the NFO dates for Motilal Oswal Most Shares NASDAQ-100 Fund?
The NFO period for Motilal Oswal Most Shares NASDAQ-100 Fund will open on March 16th, 2011 and will close on 23 March 2011.
What is so unique about this Mirae Asset India-China Consumption Fund?
The most important part of this ETF is that it is the first ETF in India which will focus on a US market and has an underlying tracking index as NASDAQ-100. This will give Indian Investors a good opportunity to trade the NASDAQ-100 index or invest in it for long term. The underlying belief is obvious that NASDAQ-100 index will perform better and generate good returns. It is expected that the US is currently in recovery phase after the 2008 recession and will lead the high growth and hence good returns are going to be generated from this market.
Being an ETF or Exchange Traded Fund, this will also given short term traders a good opportunity to trade the tick by tick price movements and benefit.
The minimum application amount for Motilal Oswal Most Shares NASDAQ-100 Fund is Rs. 10,000 and afterwards in multiples of Rs. 1.
Mr. Rajnish Rastogi is the fund manager for Motilal Oswal Most Shares NASDAQ-100 Fund ETF.
The Motilal Oswal Most Shares NASDAQ-100 Fund will be listed on both NSE and BSE post the NFO period.
No tax benefit will be available in Motilal Oswal Most Shares NASDAQ-100 Fund.
What are the other competitor products available in comparison to Motilal Oswal Most Shares NASDAQ-100 Fund?
As of now, we are not aware of any mutual fund available in India which is focussing on India and China.
What are the risks of investing and trading Motilal Oswal Most Shares NASDAQ-100 Fund ETF?
Most importantly, you need to take the time in consideration. India sleeps when the US markets are awake (and vice versa) because they are geographically on the other side of the globe. So how will this ETF prices track the underlying price movements is not clear - that is something which can be observed only when the fund lists on Stock Exchanges and starts trading. In the absence of unerlying index price changes, it will be interesting to see how the prices of this ETF change throughout the Indian Trading hours. However, long term investors who wish to invest in Motilal Oswal Most Shares NASDAQ-100 Fund ETF for long time duration should not worry about this, as in the long term the prices will match the underlying index, post expense ratio and tracking error.
Another big risk equally applicable to both short term traders and long term investors is the USD-INR forex exchange rate risk. Remember, you are going to buy a US listed index which trades in USD in INR. Here is an good example of Forex trading risk: Effect of forex on stock prices
Other products from Motilal Oswal Asset management: Motilal Oswal MOSt Shares M50 ETF and MOSt Shares M100 ETF
Final Thoughts about Motilal Oswal Most Shares NASDAQ-100 Fund?
If you believe that US companies will outperform the other markets, then you can invest in this fund. However, also take into consideration the forex risk that is involved here.
In essence, its a good unique products for both traders and investors as there is no other product available in the Indian Markets which provides exposure to the US markets and its stocks - but it needs to be considered with the risk listed above
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