Mirae Asset has launched Nifty Low Volatility 30 ETF, which will open for subscription on March 13, 2023. This is an open-ended exchange traded fund scheme replicating/tracking Nifty 100 Low Volatility 30 Index. The new fund offer (NFO) will be available till March 21, 2023. The scheme will re-open for continuous sale and repurchase on March 27, 2023.
The fund seeks to generate excess return based on portfolio of stocks that are characterized by lower than average volatility. The low volume stocks exhibit defensive characteristics resulting in lower drawdowns in bear markets, Mirae Asset said.
| Benchmark | Nifty 100 Low Volatility 30 Index |
| Fund Manager | Ekta Gala |
| Minimum Investment | Rs 5,000/- and in multiples of Re 1/- thereafter. |
| Facility Offered | SIP, STP & SWP (transaction through electronic mode), GRIP |
| Taxation | Equity |
| Exit Load | Nil |
Salient features of index:
The securities forming part of Nifty 100 Index are assessed on the basis of volatility for index inclusion
Volatility is calculated as the standard deviation of daily price returns (log normal) for last one year
Eligible stocks are then ranked based on their volatility score, with stock having lowest volatility getting a rank of 1
Top 30 ranked stocks with least volatility form part of the index. These stock are weighted as per their low volatility score.Sector-level distribution (in %)
| Top 5 Sectors | Nifty 100 Low Volatility 30 Index | Nifty 50 Index | Nifty 100 Index |
| FMCG | 24.5% | 9.0% | 9.4% |
| Information Technology | 17.1% | 14.7% | 13.3% |
| Financial Services | 13.2% | 36.8% | 34.2% |
| Healthcare | 7.4% | 3.9% | 3.7% |
| Automobile | 7.1% | 5.8% | 5.4% |
Data as on Jan 31, 2023. National Stock Exchange (NSE).
Nifty 100 Low Volatility Index is skewed towards FMCG and Healthcare sectors compared to Nifty 100 Index
| No. | Top 10 Stocks of Nifty 100 Low Volatility 30 Index | Holding(%) |
| 1 | Nestle India Ltd. | 4.3% |
| 2 | ITC Ltd. | 4.2% |
| 3 | Tata Consultancy Services Ltd. | 3.9% |
| 4 | Bajaj Auto Ltd. | 3.9% |
| 5 | Dr. Reddy's Laboratories Ltd. | 3.8% |
| 6 | HCL Technologies Ltd. | 3.7% |
| 7 | Britannia Industries Ltd. | 3.7% |
| 8 | Hindustan Unilever Ltd. | 3.6% |
| 9 | Cipla Ltd. | 3.6% |
| 10 | Larsen & Toubro Ltd. | 3.5% |
Data as on Jan 31, 2023. National Stock Exchange (NSE).
Historical Performance
| Period | Nifty 100 Low Volatility 30 Index | Nifty 50 Index | Nifty 100 Index |
| Since Inception | 17.5% | 14.2% | 14.3% |
| 15 Years | 14.2% | 9.9% | 10.1% |
| 10 Years | 14.1% | 12.7% | 12.9% |
| 7 Years | 13.9% | 14.3% | 14.0% |
| 5 Years | 11.4% | 11.3% | 10.4% |
| 3 Years | 16.1% | 15.2% | 14.6% |
| 1 Year | 3.4% | 3.2% | 1.6% |
| 6 Months | 2.1% | 3.3% | 1.5% |
| 3 Months | -0.6% | -1.9% | -3.5% |
Data as on Jan 31, 2023. National Stock Exchange (NSE)
Nifty 100 Low Volatility 30 has outperformed Nifty 100 Index in 8/15 Calendar Years and exhibited higher return-to-risk ratio in 10/15 Calendar Years since 2008.
| Calendar Year | Calendar Year Returns | Calendar Year Risk-to-Return Ratio |
| | Nifty 100 Low Volatility 30 Index | Nifty 100 Index | Nifty 50 Index | Nifty 100 Low Volatility 30 Index | Nifty 100 Index | Nifty 50 Index |
| 2022 | 2.0% | 4.9% | 5.7% | 0.13 | 0.29 | 0.33 |
| 2021 | 24.2% | 26.4% | 25.6% | 1.94 | 1.73 | 1.64 |
| 2020 | 24.3% | 16.1% | 16.1% | 0.96 | 0.53 | 0.52 |
| 2019 | 5.2% | 11.8% | 13.5% | 0.44 | 0.86 | 0.98 |
| 2018 | 7.4% | 2.6% | 4.6% | 0.65 | 0.20 | 0.36 |
| 2017 | 30.3% | 32.9% | 30.3% | 3.87 | 3.53 | 3.35 |
| 2016 | 3.1% | 5.0% | 4.4% | 0.23 | 0.33 | 0.29 |
| 2015 | 9.8% | -1.3% | -3.0% | 0.68 | -0.08 | -0.19 |
| 2014 | 36.8% | 34.9% | 32.9% | 3.01 | 2.69 | 2.60 |
| 2013 | 6.6% | 7.9% | 8.1% | 0.44 | 0.45 | 0.45 |
| 2012 | 32.1% | 32.5% | 29.4% | 2.89 | 2.16 | 1.94 |
| 2011 | -12.0% | -24.9% | -23.8% | -0.83 | -1.23 | -1.14 |
| 2010 | 25.5% | 19.3% | 19.2% | 2.30 | 1.20 | 1.18 |
| 2009 | 92.9% | 84.9% | 77.6% | 3.86 | 2.47 | 2.24 |
| 2008 | -42.3% | -53.1% | -51.3% | -1.26 | -1.19 | -1.16 |
Investing in Mirae Asset Nifty 100 Low Volatility 30 ETF?
In short-term, the fund may be used as investment during the time of bear market/choppy market, Mirae Asset said.
"In long-term it can be potentially used for investment as Nifty 100 Low Volatility 30 Index has generated higher risk-adjusted return over longer horizon. Nifty 100 Low Volatility 30 Index has relatively lower draw down compared to broad market as well other factor indices, thereby providing downside protection. The index provides alternate sectorial exposure which is different than Nifty 100 Index," it said.
