The index fund from IDBI Mutual Fund is being launched on June 16, 1999. The index fund will track the S&P CNX Nifty. According to assistant vice-president of IDBI Mutual Fund Janak Gajiwala, the index fund will be an open-ended no-load scheme, tracking the S&P CNX Nifty. The returns will be in tandem with the index movement, thereby ensuring market related returns to investors. And the scheme will be as diversified as the scrips in the index.

The minimum amount for investment is Rs 5,000. The fund has already received approval from Sebi.

An innovation whichwill be made by the mutual fund after the launch of the scheme would be to repurchase or sell units through the screen of NSE. "There will not be any trading but it will be like just clicking onto the units of the scheme to repurchase or sell the units of the scheme. The repurchase or sale would be at the net asset value (NAV) of the fund and there will not be any trading", said Gajiwala.

The normal way to purchase or sell the units of a scheme is to approach the registrars of the scheme or at the offices appointed by the mutual fund. "This will be a breakthrough in servicing of our investors. Although it will not be provided at the launch of the scheme but will be provided subsequently and we are working on the concept", added Gajiwala.

He added that there are a number of approvals required from various bodies to get a permission for such a move. "In the case of proposed screen-based trading our units would be sold and bought back by the fund. Counter party in the proposed screen based trading wouldalways be the fund. Transactions of units would be at NAV-related prices and not at the market prices, which depend on the forces of demand and supply", said Gajiwala.