Bajaj Allianz Life Insurance has launched a small-cap fund in the Unit-linked insurance plan (Ulip) segment. The new fund offer (NFO) opened on May 18, 2023 and will close on May 23, 2023.
The benchmark index is Nifty Small Cap 100 index. The net asset value (NAV) is Rs. 10. Bajaj Allianz Life Insurance has categorised the fund in the very high risk category, according to information on the insurer’s website.
Customers can invest in the fund through these seven Ulip offerings from the insurer, namely, Future Wealth Gain, Smart Wealth Goal, Magnum Fortune Plus, Future Gain, Goal Assure, Invest Protect Goal and LongLife Goal.
According to a press statement by the insurer, the small-cap fund will offer customers the opportunity to achieve capital appreciation by investing in a diversified portfolio of small-cap stocks.
Bajaj Allianz Life Insurance said that the equity investment strategy revolves around identifying companies with a competitive advantage, good corporate governance, high ROE/ROCE, robust free cash flow, growth visibility and attractive valuations.
“The underlying philosophy is to uncover businesses with large market opportunities and prioritise growth at a reasonable price from a valuation perspective. Bajaj Allianz Life Small Cap Fund will invest minimum 60 per cent in small cap stocks, and market-cap exposure is based on equity exposure re-scaled to 100 per cent,” the insurer said in a statement.
Bajaj Allianz Life Insurance further said that investors should consider the small-cap fund because the category has significant traction from investors in the other financial saving avenues, over the past few years. In addition, small-cap equity funds have managed to outperform the benchmark Nifty Small Cap 100 index by a significant margin over the long term.
“Nifty Small-cap 100 index valuation has moderated from its highs and is now below the long-term average, making a case for investment in small-caps from a valuation perspective,” the insurer said in a press statement.
Sampath Reddy, chief investment officer, Bajaj Allianz Life Insurance, said in a statement: “We are thrilled to launch the first-of-its-kind small-cap fund in the life insurance industry, with the focus on long-term wealth creation for our customers. We are confident that this fund will strongly resonate with investors and support them in the journey towards achieving their life goals.”
