UTI Mutual Fund has opened the UTI Nifty 500 Index Fund, a new fund offer from UTI Asset Management Company. The NFO opened on 24-08-2026. Neither the scheme document nor the fund’s tracker page confirms a closing date yet, so treat that date as pending confirmation.
The fund is a passive index scheme. It aims to mirror the Nifty 500 TRI, built from 500 companies across large, mid and small caps on the NSE. Rather than picking stocks, the fund manager holds the same shares in roughly the same proportion as the index.
This kind of fund may interest investors who want broad exposure to the Indian stock market in one purchase, at a lower running cost than a typical active fund, without tracking individual company results themselves.
UTI Nifty 500 Index Fund NFO details
Fund name | |
Fund type | Open ended |
Category | Equity, index fund |
Nature of scheme | Passive, replicates the Nifty 500 TRI |
Benchmark | Nifty 500 Total Return Index |
Fund managers | Sharwan Kumar Goyal (dedicated fund manager), Ayush Jain (assistant fund manager), Lokesh Kulthia (assistant fund manager) |
NFO opens | 24-08-2026 |
NFO closes | Not available |
Allotment / reopening date | 10-09-2026 (indicative) |
Minimum investment | Rs 1,000, and in multiples of Re 1 thereafter |
Additional investment | Rs 1,000, and in multiples of Re 1 thereafter |
SIP amount | Rs 500 for daily, weekly and monthly SIP; Rs 1,500 for quarterly SIP |
NAV | Rs 10 per unit during the NFO |
Risk level | Very high |
Stamp duty | 0.005% of the transaction value, as applicable to all mutual fund subscriptions |
Entry load | Not applicable |
Exit load | Nil |
UTI Mutual Fund AMC details
AMC name | UTI Asset Management Company Ltd |
Assets under management | ₹3.95 lakh crore |
Website | |
Registered office | UTI Tower, ‘Gn’ Block, Bandra Kurla Complex, Bandra (East), Mumbai 400051 |
Contact number | 1800 266 1230 (toll free) |
Source: AMFI India — New fund offer : UTI Nifty 500 Index Fund
What has UTI Mutual Fund launched?
UTI Nifty 500 Index Fund is an open ended, passively managed equity scheme. Instead of a fund manager choosing which shares to buy, it holds the same 500 companies as the Nifty 500 index, in similar weights.
The goal is to match the index’s return, before expenses. The scheme document is upfront that this objective is not guaranteed, since costs and other practical constraints can create a gap versus the index.
There is no active stock selection here. The fund manager’s role is to keep the portfolio aligned with the index and manage cash flows from investments and redemptions without disturbing that alignment.
How does the UTI Nifty 500 Index Fund strategy work?
The fund follows a set process to stay close to its benchmark. The steps below outline how money moves from an investor’s application to a position in the index.
Step | What happens? |
1 | Investor applies during the NFO; units are allotted at Rs 10 each. |
2 | The fund buys Nifty 500 shares in roughly the same weights as the index. |
3 | Up to 5% can sit in money market instruments or cash equivalents. |
4 | When the index is reconstituted, holdings are adjusted to match. |
5 | The manager tracks the daily gap versus the index, called tracking error. |
6 | If it drifts, the portfolio is rebalanced within regulatory limits. |
Let’s understand through an example
Say an investor puts Rs 10,000 into the NFO at Rs 10 per unit. That gets them 1,000 units. The fund uses this money, pooled with other investors’ money, to buy shares across the 500 companies in the index, in the same proportion the index holds them.
From then on, the fund’s NAV moves in line with the Nifty 500 index, minus the fund’s expenses. This illustration only shows how the money is deployed. It is not a projection or promise of returns.
Portfolio allocation
This is a single asset class scheme by design. The indicative allocation under normal circumstances is:
Instrument | Minimum (%) | Maximum (%) |
Securities covered by the Nifty 500 Index | 95 | 100 |
Money market instruments, cash and cash equivalents, or liquid category schemes | 0 | 5 |
UTI Nifty 500 Index Fund investment strategy
Since this is a passive fund, there is no stock selection process beyond following the index. The strategy centres on tracking methodology and rebalancing discipline instead.
The scheme caps annualised tracking error at 2%, measured against one year of rolling data. If unavoidable circumstances push it past that mark, the fund house must report the reason and any corrective steps to the trustees.
Rebalancing happens whenever the asset mix drifts outside the allocation range above, with a 7 calendar day window to restore it. Liquidity is managed through the small money market allocation.
Potential benefits
Potential benefit | Why does it matter? |
Broad market exposure | 500 companies across large, mid and small caps in one fund, instead of picking stocks individually. |
Lower running cost | Passive management typically costs less than an actively managed equity fund. |
Transparency | Holdings mirror a public index, so you always know roughly what the fund owns. |
Rule based investing | Stock selection follows the index methodology, removing manager bias. |
Key risks
Risk | What does it mean? |
Market risk | Since the fund holds equities, its value moves with the broader stock market, including during downturns. |
Tracking error | Costs, cash holdings and timing differences mean the fund’s return can deviate from the index’s return. |
Concentration risk | Because the fund mirrors the index, sectors that are heavily weighted in the Nifty 500 carry similar weight here. |
Liquidity risk | Some smaller companies within the 500 constituents may trade less frequently, which can affect execution during large flows. |
Who may consider the UTI Nifty 500 Index Fund?
Investor type | Why it may fit |
Long term equity investors | A goal seven years or more away gives broad equity exposure time to work through market cycles. |
Investors who prefer low cost, rule based funds | Those who would rather track the market than bet on manager stock picks. |
Investors building a core equity holding | A broad, diversified index can anchor a portfolio before adding satellite, higher conviction funds. |
Who may not find it suitable?
Investor type | Why it may not fit |
Investors with a goal under 3 years | Equity markets can be volatile over short periods, which does not suit near term goals. |
Investors seeking downside protection | A passive equity fund does not shift to cash or defensive sectors in a falling market. |
Investors wanting to beat the index | This fund is built to match the Nifty 500, not to outperform it. |
Comparison with traditional investment options
Option | Risk | Return potential | Liquidity | Horizon |
Fixed deposit | Low | Fixed, modest | Moderate, with penalty on early exit | Flexible |
Debt mutual fund | Low to moderate | Modest, market linked | High | Short to medium term |
Hybrid fund | Moderate | Moderate | High | Medium term |
Equity mutual fund (active) | High | Market linked, manager dependent | High | Long term |
UTI Nifty 500 Index Fund | Very high | Tracks the index, before costs | High | Long term |
UTI Nifty 500 Index Fund review by Zenith Finserve
A broad market index fund like this one tends to suit investors building a long term core equity allocation, typically for goals set seven years or further out, such as retirement or a child’s education.
Because the scheme carries a very high risk rating and no downside cushioning, it fits investors comfortable riding out market falls without needing this money soon. It is not designed to beat the market, so anyone hoping to outperform the Nifty 500 should look elsewhere.
As a broad, diversified holding, it can work well as a core position around which more focused funds are added. Suitability still depends on your existing portfolio, goals and time horizon, so weigh this fund against your own financial plan before investing.
How Zenith Financial Management can help
At Zenith Financial Management, 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
Axis Nifty50 Equal Weight Index Fund NFO: another passive index fund, though it equal weights the Nifty 50 rather than tracking the market cap weighted Nifty 500.
Edelweiss Nifty REITs & Realty Index Fund NFO: a narrower, sector focused passive index fund, unlike this scheme’s broad market coverage.
HDFC Nifty Metal ETF FOF NFO: also passive, but a single sector fund of fund rather than a diversified equity index scheme.
Frequently asked questions
What is the UTI Nifty 500 Index Fund?
An open ended passive equity scheme from UTI Mutual Fund that tracks the Nifty 500 TRI, before expenses and subject to tracking error.
Is UTI Nifty 500 Index Fund NFO good to invest in?
Depends on your goals and horizon. It suits long term, high risk investors seeking broad market exposure, not a promise of above market returns.
What does UTI Nifty 500 Index Fund invest in?
95% to 100% in Nifty 500 Index securities, and up to 5% in money market instruments or cash equivalents.
When does the UTI Nifty 500 Index Fund NFO open?
It opened on 24-08-2026. A confirmed closing date was not available at the time of writing.
What is the minimum investment amount?
Rs 1,000 lump sum, Rs 500 for monthly, weekly or daily SIP, and Rs 1,500 for quarterly SIP.
Who manages the UTI Nifty 500 Index Fund?
Sharwan Kumar Goyal, with Ayush Jain and Lokesh Kulthia as assistant fund managers.
Does it charge an entry or exit load?
No entry load, per SEBI rules, and no exit load.
What is tracking error, and does it apply here?
The gap between fund and index returns. The scheme aims to keep this under 2% annually.
Is the UTI Nifty 500 Index Fund actively managed?
No, it mirrors the Nifty 500 index rather than relying on stock picking.
How is this different from a Nifty 50 index fund?
The Nifty 500 spans 500 companies across market caps, while a Nifty 50 fund holds only the 50 largest, so this fund carries more small cap exposure.
What is the risk level of this scheme?
Very high, consistent with a diversified equity index fund.
