HDFC Mutual Fund to Splits ETFs face value
On Wednesday, HDFC Mutual Fund has announced that it plans to split the face value of three ETF schemes. The name of those schemes HDFC Sensex, Nifty 50 ETF, and HDFC Gold ETF fund. However, the face value splitting process will effect from February 19th, 2021.
According to the reports, the HDFC Nifty 50 ETF and Sensex funds will be split one-tenth each. Besides, the HDFC Gold Exchange Traded Fund may split in the 1:100 ratio. Further, the statement remains represent 0.01 gm of gold instead of 1 gm of gold.
According to the market data, for making the products more economical to small investors, separation of face value is the better way for mutual funds.
Anyhow, the split by itself could not make any loss to the investors. Although, the value is neutral. Further, the net asset value of the ETFs may fall on the record date.
Moreover, most of the unitholders of the ETFs saved in the records. Those are safes as of 19th February will get a proportionate credit.
For example, if an investor holds 10 units of HDFC Gold ETF funds, then holding will increase to 1,000 units from 19th February. Moreover, the added units will be credited to the investor’s account on 22nd February 2020.