Is Baroda BNP Paribas Nifty200 Momentum 30 Index Fund Good or Bad? - Detailed Review

Baroda BNP Paribas Nifty 200 Momentum 30 Index Fund is an index fund investing primarily in equity and equity-related securities comprising the Nifty 200 Momentum 30 index. It employs a momentum investing philosophy wherein the index selects securities based on 6-month and 12-month price returns adjusted for volatility.

Details of the Baroda BNP Paribas Nifty200 Momentum 30 Index Fund

Fund Manager of Baroda BNP Paribas Nifty200 Momentum 30 Index Fund

• Name: Mr. Neeraj Saxena

• Educational Qualification: PGDBA in Finance from Welingkars Institute and M.Sc. in Organic Chemistry.

• Experience: He has 20 years experience in the Indian Financial Services industry.

Objective of the Baroda BNP Paribas Nifty200 Momentum 30 Index Fund

The scheme's investment objective is to provide investment returns closely corresponding to the total returns of the securities as represented by the Nifty200 Momentum 30 Total Returns Index before expenses, subject to tracking errors, fees, and costs. Although, there is no assurance that the investment objective of the Scheme will be achieved.

Overview of the Baroda BNP Paribas Mutual Funds

The Baroda BNP Paribas Mutual Fund was formed through the merger of two large entities. It came into effect on March 14, 2019, after the joint venture between Bank of Baroda and BNP Paribas Asset Management Asia Ltd. 

As per reports, it states that the Bank of Baroda holds a 50.1% control in the merged company, and BNP Paribas AMC has the remaining 49.1% stake in the company. This entity has a footprint across 90 cities in India, offering more than 34 schemes in mutual funds in different categories like debt schemes, equity schemes, hybrid schemes, and more.

As reported on 31st March 2024, the Baroda BNP Paribas Mutual fund had an AUM of Rs. 35,646.45 Crores.

Peer Comparison: Baroda BNP Paribas Asset Management India Private Limited vs Other Such Fund

Highest Return of Such Funds

Lowest Return of Such Funds

Here, since all the above mutual funds track the same index, the returns generated by these mutual fund schemes have relatively similar returns in 1-year.

Concept of Nifty 200 Momentum 30 Index

The Nifty 200 Momentum 30 Index is a strategy index that will track the overall performance of the leading 30 companies that are ranked based on their normal momentum score and that are part of the Nifty 200 Index.

This normalised momentum score can be generated by analysing the 6-month and 12-month returns. This same momentum score calculation method will be applicable to other momentum index funds as well.

Risks involved in Index Funds

• Market Risk: As this is an equity-focused index, it is subject to market volatility and fluctuations in prices. 

• Index-Related risks: As the fund is structured to replicate and follow the Nifty 200 Index, it may not outperform the index itself. Thus the fund’s performance will be wholly dependent on the stocks within the index.

• Passive Investment Risk: Since the index funds are not actively managed, the scheme as per its objective would invest in the securities without minding their investment merit.

• Equity Securities Risk: These securities are subject to changes in the values of their prices and can be highly volatile when compared to the other asset classes.

Why You should Invest in Baroda BNP Paribas Nifty200 Momentum 30 Index Fund?

You should consider investing in the Baroda BNP Paribas Nifty200 Momentum 30 Index Fund if you are seeking long-term capital growth by investing in a diversified portfolio of high-momentum stocks. This fund offers exposure to the top 30 momentum stocks from the Nifty 200 index, providing the potential for higher returns while benefiting from a passive investment strategy that tracks the index performance.

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