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Home >> Blog >> SBI Silver ETF Fund of Fund- NFO: Review, Opening Date & NAV

SBI Silver ETF Fund of Fund- NFO: Review, Opening Date & NAV

  


Introduction

As a hedge against inflation, metals are in higher demand in the current state of the world economy. Silver is much more useful in industrial applications than its more well-known sibling Gold, and this adaptability contributes to Silver's eventual rise in value. Therefore, investors who desire to diversify into products can read this blog and understand if they decide to invest through the Fund of Funds offering or Silver ETF or not, and they will be able to participate in its long-term growth potential if they go for it.

This article will describe what is included in the fund program and how it works.

 

Everything You Need to Know About SBI Silver ETF Fund of Fund- NFO

SBI Silver ETF Fund of Fund by SBI Funds Management Limited is an open-ended fund of fund scheme investing in SBI Silver ETF. The scheme has a very high risk.

The lowest investment required to join is Rs.5000 for investors and in multiple of Rs.1 thereof. The scheme is suitable for such investors who are seeking Long-term capital growth and to get engaged in SBI Silver ETF investment. The scheme has a 1% Exit Load if redeemed within 15 days.

To learn about the fund's asset allocation, and other financial characteristics that influence decision-making, carefully read this blog.

 

SBI Silver ETF Fund of Fund- NFO Overview

The investment period for the Scheme is set for June 27, 2024, to July 5, 2024. The scheme is a very high-risk scheme. There is no assurance that the scheme's investment goal will be met. 

While SBI Silver ETF Fund of Fund would principally invest a minimum of 95% and a maximum of 100% of its assets in units of SBI Silver ETF. The other 5% would be invested in government securities, such as G-Secs, SDLs, Treasury bills, and any other similar instruments that the RBI may from time to time specify. Liquid mutual fund units and triparty repo units are also acceptable investments.

 

Fund Overview

Start Date

27 June 2024

End Date

05 July 2024

VRO rating

-

Expense ratio

NA

Exit load

Nil

AUM (Fund size)

NA

Lock-in

No Lockin

Stamp Duty

0.005% (From July 1st 2020)

Benchmark 

The domestic price of silver

Min. Investment

Rs.5000 and in multiples of Rs.1.

Risk

Very high

Short-term capital gains (STCG)

For less than 3 years, as per Tax Slab

Long-term capital gains (LTCG)

For more than 3 years, 20% is applicable.

 

The Objective of the Fund

The Scheme intends to produce returns that closely correspond to returns provided by SBI Silver ETF. Nevertheless, there can be no assurance or guarantee that the scheme's investment goals will be met.

Asset allocation (% of Net Assets) of the Scheme's portfolio will be as follows:

Types of Instruments

Minimum Allocation (% of Net Assets)

Maximum Allocation (% of Net Assets)

Units of SBI Silver ETF 

95

100

Government. Securities including Triparty Repo and units of debt mutual fund

0

5

 

 

Peers of SBI Silver ETF Fund of Fund

Index / Debt Funds

1Y Return

AUM (Cr)

Axis Silver FoF Regular-Growth

28.29%

41.85

HDFC Silver ETF FoF Regular - Growth

28.83%

89.47

Kotak Silver ETF Regular - Growth

28.36%

538.90

 

Risk Factors in Such Funds

  • The Scheme's primary investment vehicle might be silver exchange-traded fund units. As a result, the results of the Scheme could be influenced by the fundamental mutual fund scheme. The results of the Scheme may be impacted by modifications to the underlying scheme's basic characteristics or investing rules.

  • Securities of the Government of India Despite the fact that the Government of India Securities market has greater liquidity than other debt instruments, there may occasionally be issues with trading in the market as a result of high volatility that limits market volumes.

  • The plan won't be actively managed because it intends to invest in SBI Silver ETF with at least 95% of net assets. A broad downturn in the Indian markets pertaining to the fund it uses as its foundation could have an impact on the Scheme. Regardless of the underlying fund's investing merit, the Scheme makes investments in it.

 

 

Past Performance of Index / Debt Funds

Index / Debt Funds

NAV (Rs)

Annualized Return (1Y)

Return/Risk

Navi Nifty Bank Index Fund - Direct Plan-Growth

13.48

18.86%

Very High Risk

Motilal Oswal S&P 500 Index Fund - Direct Plan-Growth

20.91

27.92%

Very High Risk

Invesco India Nifty G-Sec Sep 2032 Index Fund - Direct Plan-Growth

1107.65

7.58%

Moderate Risk

 

SBI Silver ETF Fund of Fund - Who can invest?

This fund is ideal for you if you are looking for Long-term capital growth with Silver ETF investment.

 

SBI Silver ETF Fund of Fund - Growth Fund Managers

  • Mr. Harsh Sethi

Conclusion

The scheme comes under a very high-risk category and it plans to invest in 95% and a maximum of 100% of its assets in silver and/or silver-related products. The other 5% would be invested in government securities, such as G-Secs, SDLs, Treasury bills, and any other similar instruments that the RBI may from time to time specify. Liquid mutual fund units and triparty repo units are also acceptable investments.

Always assess your Financial Goals, Risk tolerance, etc. before making an investment decision.

Disclaimer: This NFO analysis is provided solely for informative reasons and should not be construed as investment advice. Always conduct research and talk with a financial advisor before investing.

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Frequently Asked Questions

+

The SBI Silver ETF Fund of Fund is an open-ended scheme by SBI Funds Management Limited that primarily invests in units of the SBI Silver ETF. The objective of the fund is to generate returns that closely correspond to the returns provided by the SBI Silver ETF, although there is no assurance or guarantee that the investment objectives will be met

+

The minimum investment required to join the SBI Silver ETF Fund of Fund is Rs.5000, and additional investments can be made in multiples of Rs.1.

+

The investment period for the SBI Silver ETF Fund of Fund is from June 27, 2024, to July 5, 2024.

+

The SBI Silver ETF Fund is classified as a very high-risk scheme. The underlying SBI Silver ETF may influence the performance of the fund. Additionally, investments in government securities, although generally more liquid, may face liquidity issues due to market volatility. The scheme is not actively managed, which means that a downturn in the Indian markets related to the fund it uses as its foundation could negatively impact the scheme.

+

This fund is ideal for investors seeking long-term capital growth through investments in silver and silver-related products. It is suitable for those with a high-risk tolerance and who are interested in diversifying their investment portfolio with a focus on silver.



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