Equity investing is widely regarded as a powerful way to build long-term wealth.

Traditional passive investing offers broad market exposure at a low cost, while active investing aims to outperform the market but often comes with higher expenses and variability.

Factor-based investing bridges this gap by combining the best of both approaches. It follows a rules-based, low-cost methodology like passive investing, but aims to generate alpha by targeting specific performance drivers known as factors.

These factors—such as value, quality, low volatility, and momentum - are well-studied characteristics that have historically helped explain long-term outperformance in equities.

Among these, momentum is a factor that identifies stocks that have demonstrated strong recent price performance, based on the idea that such stocks may continue to perform well in the short to medium term.

Aditya Birla Sun Life BSE 500 Momentum 50 Index Fund is a factor-based index fund that replicates the BSE 500 Momentum 50 Total Return Index, which comprises the top 50 momentum-ranked stocks from the BSE 500 universe, selected through a predefined, quantitative methodology and rebalanced quarterly.

This strategy offers investors a structured way to gain exposure to stocks that have recently outperformed, with broad sector and market cap diversification.

The fund’s low-cost, rules-based framework is designed to provide a disciplined approach to equity investing over the long term.