Kotak Nifty 500 Index Fund is a new offer from Kotak Mahindra Asset Management Company Ltd. The new fund offer (NFO) opens on 05-10-2026 and closes on 19-10-2026.
It is an index fund. It copies the Nifty 500 Total Return Index, which follows the top 500 listed Indian companies by market size and counts dividends as well as price moves. No one picks stocks here.
The appeal is wide coverage in one fund, no loads and a low starting amount. This review uses the scheme document dated 25-03-2026.
Kotak Nifty 500 Index Fund NFO details
Fund name | |
Fund type | Open-ended index scheme |
Category | Index funds (others) |
Nature of scheme | Passive equity |
Benchmark | Nifty 500 Index (Total Return Index) |
Fund managers | Satish Dondapati and Jeetu Valechha Sonar (equity); Abhishek Bisen (debt portion) |
NFO opens | 05-10-2026 |
NFO closes | 19-10-2026 |
Allotment/reopening date | Not available |
Minimum investment | ₹1,000 and any amount after that |
Additional investment | ₹1,000 and any amount after that |
SIP amount | ₹500 (minimum two instalments) |
NAV | ₹10 per unit during the NFO |
Plans and options | Direct and Regular; Growth and IDCW (payout or reinvestment) |
Stamp duty | 0.005% on purchases |
Entry load | Nil (SEBI mandates zero entry load) |
Exit load | Nil (No charges on early redemption or withdrawal) |
Kotak Mahindra Asset Management Company details
AMC name | Kotak Mahindra Asset Management Company Ltd |
Assets under management | ₹26.23 Cr (As of September 2026) |
Website | |
kmmfaccountstatement@kotak.com (account statements) | |
Registered office | 27 BKC, C-27, G Block, Bandra Kurla Complex, Bandra (E), Mumbai 400051 |
Contact number | 1800 309 1490 |
Source: AMFI India: New fund offer: Kotak Nifty 500 Index Fund
What has Kotak Mahindra Asset Management Company launched?
The fund is a passive index fund. Passive means the fund manager does not choose stocks. The fund simply holds the same companies as the Nifty 500, in the same proportions.
The Nifty 500 covers the top 500 companies by full market value. Each company counts in proportion to its free float, meaning the shares actually available for the public to trade.
The fund aims to match the index, subject to tracking error. That is the small gap that can appear between what the index returns and what the fund returns.
You can choose a Direct plan (buy straight from the fund house) or a Regular plan (buy through a distributor). Both come with Growth and IDCW options. If you do not choose, the fund treats it as Growth.
Also read: A comprehensive guide to mutual funds in India
How the Kotak Nifty 500 Index Fund strategy works
Think of it as a copy-and-maintain routine. The table shows the steps in order.
Step | What happens? |
1 | You invest during the NFO at ₹10 per unit. |
2 | The fund pools everyone’s money after the NFO closes. |
3 | It buys Nifty 500 shares in index proportions, within 30 business days of allotment. |
4 | A small part, up to 5%, sits in debt and money market instruments or liquid and overnight funds for day to day needs. |
5 | When the index changes its list of companies, the fund rebalances within 7 calendar days. |
6 | If some shares are hard to buy, the fund may briefly use futures, then switch to the real shares. |
7 | The fund tries to keep tracking error within 2%. |
Let us understand through an example
Suppose you invest ₹10,000 in the NFO. At ₹10 a unit, you get about 1,000 units (stamp duty trims this by a tiny amount).
The fund spreads your money across the 500 companies, giving more weight to the larger ones. If the Nifty 500 removes one company and adds another, the fund makes the same change.
You never pick a company. Your units move with the index, less costs.
Portfolio allocation of the Kotak Nifty 500 Index Fund
Instrument | Minimum | Maximum |
Equity and equity related securities covered by the Nifty 500 | 95% | 100% |
Debt and money market instruments | 0% | 5% |
Equity derivatives can be used up to 20% of equity holdings. Up to 5% of net assets can go into liquid and overnight funds.
Investment strategy: tracking, rebalancing and costs
There is no stock selection here. The fund has no view on whether a company is cheap or expensive. Its job is to mirror the index.
The index must follow SEBI’s spread rules: no single stock above 25%, and the top three together at most 65%.
The fund may lend shares it holds, up to 20% of net assets. Short selling and overseas investing are not allowed.
On costs, the base expense ratio can go up to 0.90% of daily net assets. Brokerage, trading costs and statutory levies come on top. The fund targets a tracking difference of 0.50% over and above the expense ratio actually charged.
Potential benefits of the Kotak Nifty 500 Index Fund
Potential benefit | Why does it matter? |
Wide coverage | One fund holds 500 companies, so no single firm decides your outcome. |
No stock picking | Results do not depend on a manager’s calls. |
No loads | There is no entry load and no exit load. |
Low starting amount | You can begin with a ₹500 SIP or ₹1,000 lump sum. |
Flexible facilities | SIP top-up, STP and SWP are available. See our SWP advisors page. |
Things to know before investing in the Kotak Nifty 500 Index Fund
Point to note | What does it mean? |
Market movement | The fund rises and falls with the Nifty 500. It can lose value in a weak market. |
Tracking error | Returns can differ slightly from the index. The fund aims to keep this within 2%. |
Costs | Expenses mean the fund returns a little less than the index itself. |
Bigger companies weigh more | Large firms have more influence on the index, and so on your returns. |
Futures use | The fund may use them for short periods, up to 20% of equity holdings. |
Index changes | Rebalancing within 7 days adds some trading cost. |
Who may consider the Kotak Nifty 500 Index Fund?
This is Zenith’s reading, not a recommendation.
Investor type | Why it may fit |
Long-term goal investor | Someone saving for a goal 7 to 10 years away, such as a 2036 education fund or retirement, with no need to dip in earlier. |
Monthly SIP saver | A salaried professional in Mumbai who can start with ₹500 and add every month. |
Investor who wants one broad core holding | Wide market coverage in a single fund, without choosing sectors. |
Rule-based investor | Someone who prefers a fixed method over a manager’s decisions. |
Who may not find the Kotak Nifty 500 Index Fund suitable?
Investor type | Why it may not fit |
Short-term goal investor | Money needed within a year or two can face a dip at the wrong time. |
Investor who wants to beat the market | An index fund aims to match the index, not outperform it. |
Theme or sector seeker | This fund spreads widely and makes no focused bets. |
Investor needing fixed income | Returns are not fixed, and values change every day. |
Comparison with traditional investment options
Option | Return potential | Volatility | Liquidity | Horizon | Suits |
Fixed deposit | Fixed, set upfront | Very low | Early exit may carry a penalty | 1 to 5 years | Steady income seekers |
Debt mutual fund | Moderate | Low to moderate | High | 1 to 3 years | Short-term savers |
Hybrid fund | Moderate to high | Moderate | High | 3 to 5 years | Balanced investors |
Equity mutual fund | High | High | High | 5+ years | Long-term investors |
This new fund | Matches the Nifty 500 | High, like the index | High after the NFO | 7+ years | Long-term, passive investors |
Kotak Nifty 500 Index Fund Review by Zenith Finserve
This fund fits a goal that is seven to ten years away, where you do not need the money in between. It suits someone who wants broad Indian equity in one place and is happy to accept whatever the market delivers.
It does not try to win. If the Nifty 500 gains, the fund gains. If it slides, so does the fund. Zenith reads this as a core holding rather than a bet.
Check overlap first. If you already hold a Nifty 50 or flexi cap fund, much of this portfolio will repeat. Before investing, test the fund against your own goal, time frame and cash needs.
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.
Learn more about Zenith or read our comprehensive financial management guide.
Similar NFOs on Zenith: related reading
- Axis Nifty500 Low Volatility 50 Index Fund NFO: draws from the same Nifty 500 universe but holds only 50 stocks.
- Axis Nifty50 Equal Weight Index Fund NFO: a broad index fund where each of 50 companies gets equal weight.
- Kotak Nifty Capital Markets Index Fund NFO: another Kotak index fund, but focused on one sector.
Frequently Asked Questions
1. Is Kotak Nifty 500 Index Fund NFO good to invest in?
It suits long-term investors wanting broad, low-cost coverage. Judge it against your goals; this is not a recommendation.
2. What does the Kotak Nifty 500 Index Fund invest in?
At least 95% goes into Nifty 500 shares. Up to 5% can sit in debt and money market instruments.
3. When does the NFO open and close?
It opens on 05-10-2026 and closes on 19-10-2026.
4. What is the minimum investment?
₹1,000 as a lump sum. A SIP starts at ₹500, with at least two instalments.
5. Is there an entry or exit load?
No. Both are nil.
6. Who manages the fund?
Satish Dondapati and Jeetu Valechha Sonar manage equity. Abhishek Bisen handles the debt portion.
7. What is the benchmark?
The Nifty 500 Total Return Index, which includes dividends as well as price changes.
8. Kotak Nifty 500 Index Fund review: how is it different from a Nifty 50 fund?
It holds 500 companies instead of 50, so smaller and mid-sized firms are included too.
9. Can I start a SIP during the NFO?
Yes. SIP and switch-in are available. You can also switch from Kotak Liquid or Kotak Overnight Fund.
10. What is tracking error?
It is the gap between the fund’s returns and the index. The fund aims to keep it within 2%.
