Funds, ETFs & Index Investing

Scheme Categorisation

SEBI's framework defining standard mutual fund categories with mandated investment characteristics.

Test: the scheme's holdings satisfy the allocation and eligibility rules prescribed for its declared category qualitative

Sectoral Fund

An equity fund that invests at least 80% of its assets in companies from a single sector.

Test: minimum 80% allocation to one defined sector, such as banking, pharmaceuticals or technology qualitative

Funds, ETFs & Index Investing

Smart Beta

A rules-based index strategy that weights constituents by a chosen factor rather than by market capitalisation.

Test: constituent weights are determined by a published rule based on a factor such as value, quality, momentum, low volatility or equal weight qualitative

Funds, ETFs & Index Investing

Systematic Investment Plan

An arrangement to invest a fixed amount in a mutual fund at regular intervals, usually monthly.

Future Value = Instalment x [((1 + r) raised to n - 1) / r] x (1 + r), where r is the periodic return and n the number of instalments ₹

Funds, ETFs & Index Investing

Systematic Transfer Plan

An arrangement to move a fixed amount at regular intervals from one scheme to another within the same fund house.

Test: units are redeemed from the source scheme and invested in the target scheme on a stated schedule ₹

Funds, ETFs & Index Investing

Systematic Withdrawal Plan

An arrangement to redeem a fixed amount from a mutual fund at regular intervals.

Units Redeemed each period = Withdrawal Amount / NAV on the withdrawal date ₹