Do you really need Groww’s new fund with widest stock coverage?

livemint.com:

₹46 trillion assets under management, and still going strong, the MF industry in India has thus been witness to a flurry of new fund houses setting up shop. Fintech firms, too, have joined the race with their cutting edge innovations . And the latest to join the bandwagon is Groww Asset Management Company (Groww AMC), which started its operations in June after acquiring Indiabulls AMC.

Groww has launched a first-of-its-kind total market index fund, which will invest in 750 stocks across large-cap, mid-cap, small-cap and micro-cap companies and covering 96% of the market capitalization. But do investors need the new fund? The company says they do. “We want to offer a well-diversified fund, in particular to retail investors who are yet to experience equity investing.

Also, right now valuations are slightly on the higher side in mid- and small-cap segments. So, this fund offers stability of large-caps," points out Varun Gupta, chief executive officer of Groww AMC. As a passively-managed fund, Groww Nifty Total Market Index Fund will track the Nifty Total Market Index.

The Nifty Total Market Index includes Nifty 500 Index stocks and Nifty Microcap 250 Index stocks. Micro cap companies are those that have less than ₹5,000 crore of market capitalization. The Nifty 500 Index can be split into large-caps (1-100 stocks in market-cap terms), mid-caps (101-250 stocks) and small-caps (251-500 stocks).

In terms of weightages, the Nifty Total Market Index will have 72% weightage in large-caps, followed by mid-caps (16.1%), small cap (8.6%) and micro cap (3.4%). Micro caps will have the least weightage as these companies’ market capitalizations are much lower than other market segments. The large stock coverage of the fund offers