Baroda BNP Paribas Asset Management India Pvt. Ltd. · IFSCA/FME/III/2023-24/099 · Feeder into BNP Paribas US Small Cap UCITS (Luxembourg)
This fund is an open-ended Category III Alternative Investment Fund (AIF) regulated by IFSCA. Key differences from a retail mutual fund:
| Fund Management Entity | Baroda BNP Paribas Asset Management India Pvt. Ltd. |
| IFSCA Registration | IFSCA/FME/III/2023-24/099 |
| Structure | Category III AIF — Open-ended Restricted Scheme (Non-Retail) |
| Direction | Outbound — invests in US small-cap equities via Luxembourg UCITS |
| Investment Objective | Long-term capital appreciation by investing in BNP Paribas US Small Cap UCITS, which targets US small-cap equities |
| Underlying Fund | BNP Paribas US Small Cap UCITS (Luxembourg-domiciled) |
| Benchmark | Russell 2000 Index |
| Number of Holdings | 89 securities (as per fund page) |
| Currency | USD |
| Excluded Investors | US persons and Canadian residents are NOT eligible |
This fund offers three share classes with different minimums, fee structures, and liquidity terms. Choose based on investment size and liquidity preference:
Key distinction from close-ended AIFs: Unlike the Mirae Asset Global Allocation Fund (which locks capital for 3 years with no redemption option), this fund is open-ended. Investors in Class T and Class I can exit after the 1-year exit-load window with no penalty. Class U has a 2-year mandatory lock-in, but after that — full liquidity. This makes this AIF structurally more flexible, though still significantly less liquid than a mutual fund. Source: Baroda BNP Paribas GIFT City fund page.
| Share Class | Subscription NAV (USD) | Redemption NAV (USD) |
|---|---|---|
| Class U | $105.1408 | $103.5245 |
| Class T | $105.1653 | $103.5485 |
| Class I | $105.3614 | $103.7417 |
NAV is published on the fund's official website. Subscription and redemption NAVs differ due to applicable loads. Class I NAV is higher than Class U/T reflecting the lower management fee (0.75% vs 1.65–1.75%) — the same underlying portfolio compounds more efficiently at lower cost. Source: Baroda BNP Paribas GIFT City fund page, June 3, 2026.
This GIFT City AIF does not directly hold US stocks. It is a feeder fund — it pools capital from Indian investors and channels it into the BNP Paribas US Small Cap UCITS, a Luxembourg-domiciled fund that actively manages a portfolio of US small-cap equities.
Why US small caps? Small-cap US equities (companies with smaller market capitalizations, typically below USD 2–5 billion) have historically delivered higher long-term returns than large caps, compensating for their higher volatility and lower liquidity. The Russell 2000 index is the standard benchmark for this segment. BNP Paribas's active management aims to select better-quality companies within the small-cap universe — its 5-year performance of +38.63% vs the Russell 2000's +27.92% (a gap of over 10 percentage points over 5 years) is the headline evidence of this.
Why a feeder structure? The UCITS (Undertakings for Collective Investment in Transferable Securities) is the Luxembourg-regulated equivalent of a retail mutual fund — highly standardised, audited, and internationally recognised. By feeding into a UCITS rather than directly managing US stocks, Baroda leverages BNP Paribas's existing institutional infrastructure and track record in US small caps, rather than building a new research team in GIFT City.
What the feeder structure means for you: Your investment journey has multiple layers: (1) You send USD to the GIFT City AIF via LRS. (2) The AIF buys units of the BNP Paribas US Small Cap UCITS. (3) The UCITS holds 89 individual US small-cap stocks. Each layer has regulatory oversight, but also its own cost and processing time.
Note: The performance below is for the underlying BNP Paribas US Small Cap UCITS fund (Luxembourg), not the GIFT City AIF wrapper. The GIFT City AIF is a feeder — its net returns to investors will be marginally lower due to the AIF's own management fee layer (0.75%–1.75% depending on share class) charged on top of the UCITS's internal expenses. The data below is the most directly comparable track record available for this strategy.
| 5 Years (Cumulative) | 10 Years (p.a.) | |
|---|---|---|
| BNP Paribas US Small Cap UCITS | +38.63% | +9.88% p.a. |
| Russell 2000 Benchmark | +27.92% | — |
The 5-year outperformance over the benchmark is +10.71 percentage points (cumulative, not annualised). Over 10 years, the underlying UCITS has returned 9.88% per annum in USD — a meaningful long-run track record for a US small-cap active strategy. Source: Baroda BNP Paribas GIFT City fund page. Performance of the underlying UCITS, not of the GIFT City AIF itself. Past performance is not indicative of future results.
The Baroda BNP Paribas GIFT US Small Cap Fund stands apart from the other GIFT City AIFs in one fundamental way: it is open-ended. You are not locking capital for 3 years with no exit option — Class T and Class I can be redeemed with no penalty after 1 year. This structural flexibility changes the risk calculus meaningfully.
Tequity's position: This fund suits HNI investors who want active, focused US small-cap exposure with institutional heritage (BNP Paribas UCITS), prefer the flexibility of an open-ended structure, and can commit USD 175K+ comfortably. Class I at USD 250K offers the best cost efficiency. For investors already holding S&P 500 or Nasdaq exposure, US small caps are a genuine portfolio complement — lower correlation to mega-cap tech, higher long-run return potential, with the trade-off of higher volatility. We will help you size this alongside your existing global allocation.
US small-cap equities are shares of smaller US companies — typically market capitalizations below USD 2–5 billion. The Russell 2000 index is the standard benchmark, containing roughly 2,000 small US companies across sectors. Small caps differ from large caps (S&P 500 companies) in several key ways:
The 10-year track record of +9.88% p.a. for the underlying UCITS is the most relevant long-run data point here. Over 10 years, a USD-denominated allocation to this strategy would have nearly 2.6x the original capital.
For resident Indians, capital gains from this Category III AIF are taxed in the investor's hands:
Class U's 2-year lock-in ensures the holding period crosses the 24-month LTCG threshold for investments held to the end of the lock-in. Classes T and I have no lock-in, so if you redeem within 24 months of investing, gains will be taxed at your slab rate. A 20% TCS is deducted on LRS remittances above INR 10 lakh per financial year — this is fully refundable when you file your Income Tax Return. Consult your CA for your personal tax situation.
The right class depends on your investment size and liquidity needs:
For most clients, Class T is the balanced choice: flexibility with a 1-year notice period, lower fee than Class U, and accessible at USD 175K. Class I is compelling for USD 250K+ allocations where long-run cost matters. Speak with Tequity to compare net return scenarios across classes for your specific holding period.
We'll help you decide between share classes, plan LRS remittances, and position this alongside your existing global allocation.
This fund adds genuine diversification to large-cap-heavy global allocations. We'll help you choose between share classes, compare net returns at different fee levels, and plan your LRS remittances efficiently.
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