Synopsis: This article highlights how the Motilal Oswal S&P 500 Index Fund managed to deliver returns up to 40.08% over the last year, outperforming the international category average. Strong gains in US technology and AI-driven companies have boosted investor interest in the fund.
The strong rally in US technology and the AI-driven companies have clearly supported global equity markets over the past year. Meanwhile, Indian investors are increasingly exploring international mutual funds, mostly to get exposure to some of the world’s biggest businesses like Apple, Microsoft, NVIDIA, Amazon, Alphabet, and Meta Platforms. The Motilal Oswal S&P 500 Index Fund has gained more attention and has outperformed the international equity category.
What is the Motilal Oswal S&P 500 Index Fund?
- The Motilal Oswal S&P 500 Index Fund is an international passive mutual fund that aims to replicate the performance of the S&P 500 Index; this index tracks the top 500 major companies that are listed in the United States.
- The fund offers a diversification of exposure across multiple sectors like technology, healthcare, financial services, consumer goods, and communication services, with recognizable companies worldwide such as Apple, Microsoft, NVIDIA, Amazon, Alphabet, and Meta Platforms.
- Since it is a passive index fund, its purpose is to mirror the benchmark performance with very low tracking error rather than making active stock selections.
- The fund is for investors who want longer-term international diversification and direct exposure to the US economy.
Fund Snapshot & Performance
Motilal Oswal S&P 500 Index Fund
- NAV: ₹32.78
- AUM: ₹4,365.10 Cr
- Expense Ratio: 0.75%
- Exit Load: 1% (within 7 days)
- Performance Snapshot
- 1-Year Return: 40.8%
- 3-Year CAGR: 28.3%
- 1-Year Absolute Return: 40.8%
- 3-Year Absolute Return: 111.4%
- Category Comparison (1-Year)
- Fund 1-Year Return: 40.8%
- Equity international Category Average: 29.5%
- Outperformance: +11.3 percentage points
Also read: Top 5 Aggressive Hybrid Mutual Funds Delivered Up to 21% CAGR Returns in 3 Years – Do You Hold Any?
Why is the Fund Gaining Investor Attention?
- The fund has gained investor attention due to the strong rally in US technology and in AI-led companies over the past year.
- The S&P 500 Index includes some of the world’s largest businesses across sectors such as AI, semiconductors, cloud computing, and digital services, so those have helped the overall market performance remain strong.
- Growing interest in international diversification and passive investing has also boosted demand for US-focused index funds.
Risks Investors Should Consider
- High valuations in US technology stocks may increase market volatility
- Rising US bond yields and interest rate uncertainty can affect equity markets
- Currency fluctuations between the Indian rupee and US dollar may impact returns
- Global geopolitical and economic uncertainty can influence investor sentiment
- Technology-heavy exposure may lead to sharper market corrections during volatility
Who should invest?
This fund is designed for investors who want long-term growth by getting exposure to the US economy and also companies that are globally leading. It fits for those who can handle global market ups and downs and rather favor a more passive investing approach.
Note: New SIP registrations and fresh investments in the fund are currently unavailable.
Investment Outlook
The long-term view for US equities still looks positive, supported by the growth of artificial intelligence, tech, and digital businesses. However, global market volatility and interest rate uncertainty remain, and the valuations on technology stocks may continue to influence short-term performance.
Written by Ameet S
