Kotak Mahindra Mutual Fund has launched the Kotak Nifty Capital Markets Index Fund, an open-ended index fund tracking the Nifty Capital Markets Index. The NFO opens on 15-09-2026 and closes on 29-09-2026.
The fund aims to mirror the index’s returns before expenses, by holding the same stocks in roughly the same proportion.
The index covers companies that run India’s capital market infrastructure: exchanges, depositories, asset managers and broking firms, per NSE’s own description of the index. That gives investors one fund for this corner of the financial sector.
Kotak Nifty Capital Markets Index Fund NFO details
Field | Detail |
Fund name | |
Fund type | Open-ended index fund |
Category | Other schemes, index funds |
Nature of scheme | Passively managed, tracks the Nifty Capital Markets Index |
Benchmark | Nifty Capital Markets Index (TRI) |
Fund managers | Satish Dondapati, Jeetu Valechha Sonar (equity); Abhishek Bisen (debt) |
NFO opens | 15-09-2026 |
NFO closes | 29-09-2026 |
Allotment / reopening | Not specified in the SID; first NAV due within 5 working days of allotment |
Minimum investment | Rs 1,000, and any amount thereafter |
Additional investment | Rs 1,000, and any amount thereafter |
SIP amount | Rs 500 a month, minimum 2 instalments |
NAV | Rs 10 per unit during the NFO |
Stamp duty | 0.005% on applicable transactions |
Entry load | Not applicable |
Exit load | Nil |
Kotak Mahindra Asset Management Company details
Field | Detail |
AMC name | Kotak Mahindra Asset Management Company Limited |
Assets under management | Not available in the source document |
Website | |
Email / contact | |
Registered office | 6th Floor, Kotak Towers, Building No. 21, Infinity Park, Off Western Express Highway, Goregaon-Mulund Link Road, Malad (East), Mumbai 400097 |
Contact number | 1800 309 1490 / 044-40229101 |
Source: AMFI India, New fund offer: Kotak Nifty Capital Markets Index Fund
What has Kotak Mahindra Mutual Fund launched?
The Kotak Nifty Capital Markets Index Fund is an open-ended, passively managed index fund under SEBI’s “other schemes, index funds” category.
A passive fund does not try to beat the market. It simply follows a published index, buying the same stocks in roughly the same weights. Its universe is limited to that index’s stocks and, occasionally, related derivatives.
The objective, in the AMC’s words, is returns that, before expenses, correspond to the index’s total returns, subject to tracking error, with no guarantee it will be met.
The fund manager does not pick stocks; the job is to replicate the index and stay in step as it changes. Normally, 95% to 100% of assets sit in the index’s equities, with the remaining small portion, up to 5%, in debt and money market instruments for liquidity.
How does the Kotak Nifty Capital Markets Index Fund strategy work?
NSE Indices, which owns the Nifty Capital Markets Index, decides which stocks belong in it and their weights. The fund manager’s task is simply to keep the portfolio matching that index.
Step | What happens? |
1 | NSE Indices reviews the index periodically and sets constituent stocks and weights. |
2 | The fund buys these stocks in roughly the same proportion as the index. |
3 | At a scheduled review, the fund rebalances within 7 calendar days of any change. |
4 | Up to 5% of the portfolio stays in cash or money market instruments for daily flows. |
5 | If a corporate action removes a stock from the index, the fund exits it within 7 days. |
6 | Throughout, the manager aims to minimise tracking error rather than pick winners. |
Let’s understand this through an example
Say the index holds 20 stocks. Stock A is 12% of the index and Stock B is 4%. Invest Rs 10,000, and roughly Rs 1,200 tracks Stock A and Rs 400 tracks Stock B, in that same ratio.
If NSE Indices later raises Stock B’s weight to 6%, the fund matches it within the 7-day rebalancing window. No fund manager judgement drives this; the index decides.
Kotak Nifty Capital Markets Index Fund portfolio allocation
Instrument | Allocation |
Equity and equity-related securities (index constituents and derivatives) | 95% to 100% |
Debt and money market instruments | 0% to 5% |
The scheme may also place up to 5% of net assets in liquid or overnight funds, and lend securities up to 20% of net assets for a fee.
Kotak Nifty Capital Markets Index Fund investment strategy
The core method is full replication: holding the same stocks as the index, in the same weights.
Rebalancing follows two triggers: a scheduled index review, or a corporate action forcing a stock out between reviews. Both are done within 7 days.
Around rebalancing, or when index stocks are scarce, the fund may use derivatives, capped at 20% of equity assets, instead of the physical stock. A small cash sleeve, generally within 5%, manages day-to-day flows.
The fund excludes ADRs, GDRs, foreign securities, credit default swaps, InvIT units, securitised debt, commodity derivatives and short sales.
Potential benefits of the Kotak Nifty Capital Markets Index Fund
Potential benefit | Why does it matter? |
Focused theme exposure | One fund for India’s capital market infrastructure companies (exchanges, depositories, asset managers, brokers) |
Rules-based and transparent | Holdings mirror a published index |
Limited fund-manager judgement | Returns track the sector and index, not one manager’s calls |
No exit load | Redeem any time without an exit charge |
NFO switch-in facility | Move money in from Kotak Liquid Fund or Kotak Overnight Fund (growth option) |
Things to know before investing
Every fund has trade-offs. Here is what is worth understanding about this one.
Factor | What it means |
Concentration in one theme | Leans on the capital markets and financial services sector, with no other sector to fall back on if it underperforms |
Tracking difference | Returns may not exactly match the index, due to costs and rebalancing lag |
Market movements | Staying 95% to 100% in equities means the NAV moves with broader market swings |
Derivative use | Short-term derivative use around rebalancing can magnify gains and losses |
Liquidity of underlying stocks | Thin trading in constituent stocks can make rebalancing at fair value harder |
Who may consider the Kotak Nifty Capital Markets Index Fund?
Investor profile | Why it may fit |
Long-term equity investors (5 years or more) | Can stay invested through a full market cycle |
Investors who follow the capital markets theme | Already hold a view on exchanges, depositories, asset managers and brokers |
Investors building a satellite allocation | Want a focused, thematic slice atop a diversified core |
Investors comfortable with passive investing | Prefer index-tracking over a manager’s stock calls |
Who may not find the Kotak Nifty Capital Markets Index Fund suitable?
Investor profile | Why it may not fit |
Investors seeking a core, diversified holding | This fund concentrates in one part of the market |
Investors with a short time horizon | Thematic funds can swing more than diversified ones |
Investors expecting guaranteed returns | None are promised under this scheme |
Investors who prefer active stock selection | This fund follows an index mechanically |
Kotak Nifty Capital Markets Index Fund compared with traditional options
Option | Return potential | Volatility | Liquidity | Horizon | Suitable investor |
Fixed deposit | Low, pre-declared | Very low | High* | Any | Capital protection |
Debt mutual fund | Low to moderate | Low to moderate | High | Short to medium | Conservative |
Hybrid fund | Moderate | Moderate | High | Medium term | Balanced |
Equity fund (diversified) | High | High | High | Long term (5+ yrs) | Growth, broad exposure |
This fund | High, one theme | High, concentrated | High | Long term (5+ yrs), satellite | Focused theme exposure |
*Early FD withdrawal typically costs some interest.
Kotak Nifty Capital Markets Index Fund Review by Zenith Finserve
This is a thematic, passively managed bet on India’s capital market infrastructure companies, not a diversified core holding. That distinction matters when deciding where it fits in a portfolio.
Tracking a narrow, roughly 20-stock index in one theme, it suits a horizon of five years or more, for a goal where sector-specific swings can be absorbed. It fits better as a smaller, satellite allocation alongside a diversified core than as a first equity fund.
Weigh how this sector allocation fits your existing portfolio and goal timeline before you invest. Our mutual fund advisory service can help you work through that fit.
How Zenith Finserve can help
At Zenith Finserve, we follow a process driven investment framework. We assess your goals, cash flows, risk profile, time horizon, existing investments, loans and tax situation before suggesting investments.
We align our investment suggestions with your financial objectives and review them periodically to keep them suitable as your circumstances change.
Similar NFOs on Zenith
Kotak Multi Sector Omni FOF NFO: also from Kotak Mahindra, but a fund of funds across several sectors, not one theme.
Axis Nifty Energy Index Fund NFO: another single-theme Nifty index fund, tracking energy instead.
Invesco India Nifty India Defence Index Fund NFO: a comparable thematic fund tracking defence, with a similar NFO window.
Frequently asked questions
What is the Kotak Nifty Capital Markets Index Fund?
An open-ended index fund from Kotak Mahindra Mutual Fund tracking the Nifty Capital Markets Index, giving exposure to India’s capital market infrastructure companies.
When does the Kotak Nifty Capital Markets Index Fund NFO open and close?
It opens on 15-09-2026 and closes on 29-09-2026.
What is the NAV during the NFO?
Rs 10 per unit.
Is Kotak Nifty Capital Markets Index Fund NFO good to invest in?
That depends on your goals. It suits focused, long-term exposure to this theme, not a core holding. Evaluate suitability before investing.
What does the Kotak Nifty Capital Markets Index Fund invest in?
Mainly stocks in the Nifty Capital Markets Index, with a small debt and money market portion.
Is there an exit load on this fund?
No. The SID states the exit load is nil.
What is the minimum SIP amount?
Rs 500 a month, with a minimum of two instalments.
Who manages the Kotak Nifty Capital Markets Index Fund?
Satish Dondapati and Jeetu Valechha Sonar manage the equity portion; Abhishek Bisen manages the debt portion.
What is the expense ratio of the fund?
The SID caps the base expense ratio at up to 0.90% a year. The final Total Expense Ratio will be published on Kotak Mutual Fund’s TER page once the fund is live.
Can I switch into this fund from another Kotak scheme during the NFO?
Yes, from Kotak Liquid Fund or Kotak Overnight Fund (growth option), along with SIP.
How is this different from a Nifty 50 or Nifty 500 index fund?
A Nifty 50 or 500 fund spreads across the broad market. This fund concentrates in around 20 stocks from one theme.
What is Zenith Finserve’s review of this fund?
A thematic, passively managed option for a long-term satellite allocation, not a core holding. See the review above, our guide to mutual funds in India, our index funds glossary entry, or get in touch.
