SBI Mutual Fund announced the launch of the SBI Silver ETF Fund of Fund, an open-ended fund of fund scheme investing in SBI Silver ETF.
The scheme opened for public subscription on June 27, 2024, and will close on July 05, 2024. The scheme re-opens for continuous sale and repurchase within five business days from the date of allotment.
This is an open-ended exchange-traded fund scheme replicating the SBI Silver ETF Fund of Fund.
This open-ended Fund of Fund scheme is suitable for investors seeking
The primary investment objective of the scheme is to generate returns by investing in units of SBI Silver ETF. There is no assurance that the investment objective of the scheme will be realized.
Investors can invest under the scheme with a minimum investment of ₹1000 per plan/option and in multiples of Re 1. There is no upper limit for investment.
Under normal circumstances, the asset allocation of the scheme will be as follows:
| Types of Instruments | Indicative allocations (% of total assets) | |
Minimum | Maximum | |
Units of SBI Silver ETF | 95% | 100% |
Government securities including Triparty Repo and units of debt mutual fund | 0% | 5% |
To date, many asset management companies (AMCs) have launched such silver ETF fund of funds, thus, allowing inclined investors to avail of returns corresponding to the total returns of the securities in this particular index. Most of these funds are not too old, which means that investors can assess them only by their recent performance. These include:
Mutual Fund House | Nifty Bank ETF |
HDFC Mutual Fund | HDFC Silver ETF Fund of Fund |
Kotak Mahindra Mutual Fund | Kotak Silver ETF Fund of Fund |
ICICI Prudential Mutual Fund | ICICI Pru Silver ETF Fund of Fund |
Nippon India Mutual Fund | Nippon India Silver ETF Fund of Fund |
Aditya Birla Sun Life Mutual Fund | Aditya Birla Sun Life Silver ETF FoF |
| Source: MoneyControl (As of June 30, 2024) | |
The SBI Silver ETF Fund of Fund shall be benchmarked against the domestic price of silver (based on the London Bullion Market Association (LBMA) Silver daily spot fixing price).
The trustee may change the benchmark for the scheme in the future if benchmark(s) better suited to the investment objective of the scheme are available at such time and as per the guidelines and directives issued by SEBI from time to time.
This scheme involves no “Entry Load”, which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load” would be calculated as under:
The AMC reserves the right to modify/change the load structure on a prospective basis.
Harsh Sethi is the designated fund manager of this scheme.
The scheme involves “Very High Risk” as per the details mentioned in the Scheme Information Document and is best suited to investors willing to understand that their principal will be subject to very high risk only. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.
