Nippon India MF launches Active Momentum Fund

Nippon India Mutual Fund has introduced the Nippon India Active Momentum Fund, an open-ended equity scheme designed to generate long-term capital appreciation. The fund will invest in a diversified portfolio of equity and equity-related instruments, leveraging a momentum-based strategy to capture high-performing stocks.

The new fund offer (NFO) will close for subscription on February 24.

It will reopen for continuous sale and repurchase on March 6. Investors can participate in the fund with a minimum investment of ₹500 during the NFO, with subsequent investments in multiples of ₹1.

The fund is benchmarked against the Nifty 500 TRI.

Nippon India Active Momentum Fund employs a multi-factor quantitative model aimed at identifying high-potential investment opportunities while managing volatility and adapting to market cycles. The fund’s core strategy blends price momentum with earnings revisions, integrating both technical and fundamental factors to optimize returns.

By doing so, the fund seeks to benefit from market trends while incorporating expert insights on earnings growth.

The strategy also adapts to market conditions through a “Risk ON” and “Risk OFF” framework. During “Risk ON” phases, the fund enhances upside potential by adding the Beta factor to momentum. In “Risk OFF” phases, it employs minimum volatility to mitigate risk and stabilize performance. The portfolio is rebalanced monthly to dynamically capture market shifts and optimize allocation.

Additionally, the fund may integrate factors like Minimum Volatility and Beta to reduce risk during downturns while enhancing returns in uptrends. This combination allows investors to participate in high-quality momentum with reduced volatility.

Saugata Chatterjee, Chief Business Officer, Nippon India Mutual Fund, said, “The Nippon India Active Momentum Fund brings a differentiated offering to the market by harnessing the alpha potential of momentum along with risk mitigation factors to reduce volatility and improve the investment experience. This strategic blend ensures that investors are riding high-quality momentum with reduced risk.”