What is Nifty Bees? Advantages, Investment, Fee, Safety 2021
When you start taking interest in the stock market, you might encounter many new things instead of stocks. Things like debentures, Nifty bees, Dividends etc are totally new for noob Investors. In this article let’s discuss What is Nifty bees and it’s advantages.
What is Nifty Bees?
The full form of Nifty Bees is Nifty Benchmark Exchange Traded Scheme. The S&P CNX Nifty Index is the first exchange traded fund (ETF) in India, and it aims to deliver investment returns that closely match the total returns of securities represented by the S&P CNX Nifty Index.
The Nifty BeES is a combo of a share and a mutual fund unit that trades on the NSE ‘s capital market section (National Stock Exchange). Every Nifty BeES unit represents a tenth of the value of the S&P CNX Nifty Index.
In the rolling settlement, Nifty BeES units are exchanged and settled in dematerialized form, just like any other stock. As a result, you may trade in real time on the NSE and get real-time symptomatic NAV (net asset value).
Fees and Charges
After Understand What is Nifty bees, Let’s take look at fees and charges. The Nifty BeES approach is a no-load strategy. The annual cost ratio, which includes management fees, is capped at 0.80% of Daily Average Net Assets, one of the cheapest for any mutual fund scheme in India.
For assets worth more than Rs.5 billion, the charges drop to 0.65%. In addition, investing in the Nifty BeEs ETF provides diversity because one unit may be used to invest in 50 different firms.
How does it work?
It was the benchmark’s first ETF, launched in January 2002. Diversification, index tracking, and minimal fees are all advantages of Nifty BeES. Nifty BeES may be purchased and sold like a stock using any NSE terminal at the current market price. Nifty BeES’ basic portfolio closely resembles that of the S&P CNX Nifty.
As a result, Nifty BeES follows the direction of the S&P CNX Nifty & aims to deliver investment returns that closely match the S&P CNX Nifty Index’s total returns on assets.
As they trade on the capital market, Nifty BeEs are extremely liquid. Limit orders can also be placed on these ETFs. Because Nifty BeEs track the S&P CNX Nifty Index, the investor is always up to date on the portfolio.
Value, Face Value & Symbol
Nifty BeEs represent a tenth of the value of the S&P CNX Nifty Index. The face value of the note is INR 10. And with a demat account, investors may simply deal in them.
The units of this ETF may only be bought and sold in a dematerialized manner. Because it is an ETF, the units are bought and sold at the current NAV or market price. This ETF can also be invested in in a systematic manner.
Originally published at https://profitmust.com on July 20, 2021.
