UTI Shariah Nifty500 Index Fund NFO: Invest in Ethical Stocks

UTI Mutual Fund has recently launched a new thematic index mutual fund called the UTI Nifty500 Shariah Index Fund with its New Fund Offer (NFO) now open for subscription. This scheme gives investors a chance to invest in a large basket of Shariah-compliant Indian companies, following a simple, passive strategy that tracks an established market index.

The NFO opened on February 5, 2026, and will remain available until February 18, 2026. During this period, investors can subscribe at an offer price of ₹10 per unit. After allotment, the fund will begin trading at its prevailing Net Asset Value (NAV).

What Is This Fund All About?

The UTI Nifty500 Shariah Index Fund is an open-ended equity scheme that aims to replicate the performance of the Nifty500 Shariah Total Return Index, subject to tracking error. This means it tries to mirror the returns of the underlying index as closely as possible, using a passive investment approach.

The Nifty500 Shariah Index itself is made up of companies selected from the broader Nifty500 universe, after applying Shariah screening criteria. These criteria filter out businesses that don’t comply with Islamic investment principles — such as those involved in alcohol, gambling, tobacco, and other non-permissible sectors — making the index suitable for investors seeking Shariah-compliant exposure in equities.

Key Features & Investment Details

• Fund Type: Equity – Flexi Cap Index Fund
• Benchmark: NIFTY 500 Shariah Total Return Index
• Minimum Lump Sum: ₹1,000
• Minimum SIP: ₹500
• Exit Load: Nil (no exit fee)
• Direct & Regular Plans Available: Both offer Growth options
• No Lock-in Period: Investors can redeem anytime after allotment

Who Might Consider This Fund?

This fund could be attractive to investors who want:

• Exposure to Indian equity markets through a diversified index fund.
• Shariah-compliant investment options that align with ethical investment principles.
• A passive, low-cost approach instead of actively managed funds.

Because it tracks a broad index, the scheme offers exposure across large, mid, and smaller-cap stocks within the Shariah-filtered universe, giving a wide market footprint rather than concentration in only a few sectors.

Things to Keep in Mind

Like all equity mutual funds, this scheme carries market risk, and returns are not guaranteed. The performance of the fund will be linked to the performance of the underlying index, and tracking error, expense ratio, and market conditions can all affect outcomes. Always review the Scheme Information Document (SID) and consult your financial advisor if needed.

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Disclaimer – The fund’s investment objective, asset allocation, and risk profile are as described in the scheme offer documents, and investor shall read carefully before investing. All information has been obtained from sources believed to be reliable; however, no guarantee, warranty, or representation is made regarding its accuracy, completeness, or adequacy. Portfolio construction, execution strategies, and the use of permitted instruments are based on prevailing market conditions and subject to SEBI Mutual Funds regulations. Any income distributions are subject to applicable tax laws, which may change from time to time. Investors should consult their financial and tax advisors regarding applicable laws, investment horizon, and suitability of the Scheme.