PPFAS Receives Approval to Launch Two GIFT City Funds: IFSC S&P 500 FoF and Nasdaq 100 FoF

Mumbai, November 20: PPFAS Asset Management Private Limited has announced that it has secured the approval to launch two new passive GIFT City-based outbound funds. These funds are designed to provide Indian investors with direct access to US equity markets. The two new funds are named Parag Parikh IFSC S&P 500 FoF and the Parag Parikh IFSC Nasdaq 100 FoF. Both the funds will be structured as funds-of-funds and will invest in UCITS-compliant global index funds..

Passive Investment Strategy to Target Global Indices

As per the offer document, both the funds will follow a passive investment approach. They will allocate 90-100% of the total portfolio to ETFs and UCITS, which will be linked to their respective benchmark indices. The remaining 0-10% is allowed to be invested in debt instruments. The funds are benchmarked to S&P 500 Net Total Return Index (TRI), and Nasdaq 100 Notional Net TRI.

Designed for a Wide Investor Base

Indian resident individuals, partnership firms, corporates, trusts, and any other eligible investor can invest in both the funds. The units for the funds carry a face value of USD 100, and their NAV will be calculated on a daily basis. Both of the funds do not have a lock-in period or exit load.

The funds funds will offer two classes of units, each with fixed minimum investment requirements:

• Class A (Direct): Minimum USD 5,000, top-ups from USD 500, TER 0.30%
• Class B (Regular): Same minimums, TER 0.60%

Investor Friendly Features

PPFAS said that both of its funds offer many investor friendly features. They include:

• No inheritance tax implications
• Simplified tax compliance since taxation applies at the fund level
• Cost optimisation in foreign exchange conversion and transactions
• Regulatory alignment under the permitted OPI route through a GIFT City pooled vehicle
• Strong governance and compliance frameworks

The announcement of two new funds by PPFAS is part of its bigger strategy. This comes after the company announced its plans to launch three new international equity FoFs, with two passive and one active, in a recent industry summit. The newly launched funds provide a way to Indian investors to have exposure to US markets. However, it is important to research both the funds before investing.

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