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DSP Mutual Fund announced the launch of ‘Quality-Focused’ Smallcap Fund DSP Nifty Smallcap250 Quality 50 Index Fund (DSP NSQ50IF), an open-ended scheme tracking Nifty Smallcap250 Quality 50 Index.
Out of the 250 stocks in the Nifty Smallcap250 universe, the index applies exclusion criteria and stock selection criteria to filter out companies which do not make the cut and choose 50 stocks that fit the criteria. The quality filters include Return on Equity, Debt to Equity and Earnings Per Share. Hence, the Nifty Smallcap250 Quality 50 Index (Quality Index) has companies that have higher ROE and lower leverage compared to the Nifty Smallcap250 (broader Index).
The Quality Index has outperformed its parent broader Index since its inception. In 12 out of 19 calendar years – the Quality Index performed better than the broader Index. In fact, on a 10-year basis, the Quality Index has always outperformed the broader index as well as active Smallcap funds.
Investors are recommended to buy DSP NSQ50IF via the SIP route.
The New Fund Offer for DSP NSQ50IF will open for subscription on December 5, and will close on December 15.
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