ICICI Update: Amidst the news of IPO, ICICI launched a new fund, opportunity to invest till July 22..

Amidst the Rs 10,000 crore IPO, ICICI Prudential has launched a fund in which you can expect better profits. ICICI Prudential has launched the Active Momentum Fund. Launched on July 8, this fund will close on July 22. It is designed to capture opportunities arising from consistent price and earnings/estimates trends in the market. One can invest in it with a minimum of Rs 5,000. Later, you can invest an additional Rs 1,000.

How will this fund work

Regarding the launch, Sankaran Naren, ED and CIO, ICICI Prudential AMC, said, "Our goal is to fundamentally gain momentum with value by focusing on the momentum of earnings/estimates. India's equity market is diverse, with stocks and sectors displaying different earnings trends at different times. The scheme aims to take advantage of these trends." This scheme has the flexibility to switch across sectors, market caps, and uses a combination of top-down and bottom-up approaches in portfolio construction.

How to get better returns

Price momentum identifies stocks with favorable price trends and risk-adjusted returns over different periods. It makes more use of technical analysis, and its drivers are market sentiments, technical factors, and investor behavior. There is a risk of sudden trend reversal. Earnings momentum selects stocks based on trends in their earnings revisions and analysts' ratings. It makes more use of fundamental analysis, and its key drivers are strong businesses, growing margins, or operational efficiency. Also, momentum backed by earnings is more sustainable as it takes time for the trend to reverse, unless a disruptive event occurs. Events can have a significant positive or negative impact on a company's earnings and price trends. Any sector can gain momentum, which can lead to a market expansion. Momentum as a characteristic changes its style, depending on market trends. Depending on the flows, momentum can be found in large caps as well as small and midcaps.

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