One smart approach to diversify your portfolio and expose yourself to many facets of the Indian economy is investing in Exchange-Traded Funds (ETFs). These are some of the best ETFs available right now in India:
SBI Nifty 50 ETF Overview
Tracking the Nifty 50 Index, which ranks India’s top 50 companies across several sectors.
Why Think Through?
- Diversification: Coming across a wide spectrum of top companies.
- Performance: Regular returns matched to the Nifty 50 Index.
- Expense Ratio: Low, at 0.04%.
Performance:
- Return for one year: 12.8%.
- The 3-year return is 12.1%.
- 5-year return: 15.6%.
Kotak Nifty PSU Bank ETF Overview
Tracking the Nifty PSU Bank Index, highlights public sector banks.
Why Think Through?
- Sector Focus: Designed exposure to the public banking system of India.
- Growing Potential: Gaining from government projects and reforms.
- Expense Ratio: Moderate, at 0.49%.
Performance:
- Year Return: 14.4%.
- Return in three years: 37.7%.
- Five years’ return: 21.4%.
Motilal Oswal NASDAQ 100 ETF Overview
With exposure to 100 of the biggest non-financial companies listed on the NASDAQ.
Why Should One Think?
- Global Diversification: Availability of top worldwide technology companies.
- Performance: Excellent past gains.
- Expense Ratio: Higher at 0.58%; justified by worldwide exposure.
Performance:
- One-year return: 34.1%.
- Third-year return: 14.6%.
- The five-year return is 23.6%.
Nippon India ETF Nifty Midcap 150
Tracking the Nifty Midcap 150 Index, providing mid-sized company exposure.
Why Think Through?
- Usually, midcap companies have better growth possibilities.
- Diverse midcap sectors help to distribute risk.
- Expense Ratio: Reasonable, at 0.22%.
Performance:
- One-year return: 25.2%.
- Third-year return: 24.1%.
- Five Years’ Return: 27.9%.
CPSE ETF Overview
Comprising shares of significant Central Public Sector Enterprises (CPSEs).
Why Should One Think?
- Government Backing: Funds established public sector businesses.
- Dividend yield appeals to those looking for income.
- Expense Ratio: Low, at 0.07%.
Performance:
- One-year return: 31.3%.
- Three-year return: 42.9%.
- Five-year return: 30.1%.
Important Factors Prioritizing Investment Objectives:
- Match ETF decisions to risk tolerance and financial goals.
- Lower ratios can, over time, improve net returns.
- Make sure the ETF shows enough trading volume to facilitate simple transactions.
- Lower tracking errors show closer alignment with the underlying index.
- Investing in ETFs provides a methodical way to access many market sectors. Choosing ETFs that fit your investing plan will help you to create a strong and varied portfolio.