In this article, we will discuss
Among the many market-linked investments available in India, exchange-traded funds (ETFs) are one of the most versatile options. ETFs are a type of mutual fund that pools money from numerous investors and invests in a basket of different financial securities. However, unlike traditional mutual funds, exchange-traded funds are listed and traded on stock exchanges.
Since ETFs offer a unique blend of diversification, cost-effectiveness, and ease of trading, they are widely considered an attractive investment option for both novice and experienced investors alike.
If you are planning to invest in an exchange-traded fund but are finding it challenging to select the ideal option, then this guide may be able to help. In this article, we will explore 15 of the best ETF funds in India and some of their key metrics to help you make the right investment decision.
15 Best ETFs in India in 2024
From broad market indices to sector-specific funds, the following India ETF list is intended to give you a fair idea of the kinds of options that are available for investing.
1. SBI - ETF Nifty 50
Introduced in 2015, the SBI - ETF Nifty 50 is an exchange-traded fund that tracks the performance of the Nifty 50, which is the flagship index of the NSE. About 99.58% of this Nifty 50 ETF’s funds are invested in the equity segment, of which around 80.84% are in large-cap stocks and 3.23% are in mid-cap stocks.
Key Metrics
- Net Asset Value (NAV): Rs. 258.90
- Expense Ratio: 0.04%
- Fund Size: Rs. 1,93,633.6 Crore
- 1-Year Returns: 26.92%
- 3-Year Returns: 17.15%
- 5-Year Returns: 17.63%
2. CPSE ETF
The CPSE (Central Public Sector Enterprises) ETF, managed by Nippon India Mutual Fund, tracks the performance of the Nifty CPSE Index. It is the only exchange-traded fund that offers exposure to major public-sector companies across different industries in India. About 70.55% of the ETF’s funds are invested in large-cap companies, around 24.85% in mid-cap companies, and about 2.37% in small-cap entities.
Key Metrics
- Net Asset Value (NAV): Rs. 99
- Expense Ratio: 0.05%
- Fund Size: Rs. 42,632.15 Crore
- 1-Year Returns: 128.56%
- 3-Year Returns: 56.79%
- 5-Year Returns: 31.9%
3. UTI BSE Sensex ETF
The UTI BSE Sensex ETF tracks the performance of the S&P BSE Sensex, which is the benchmark index of the Bombay Stock Exchange. It comprises 30 of the largest and most actively traded stocks on the exchange. Investing in this ETF is a good way to gain exposure to some of the country’s most established companies. All of the stocks in this ETF’s portfolio belong to the large-cap segment of the stock market.
Key Metrics
- Net Asset Value (NAV): Rs. 888
- Expense Ratio: 0.05%
- Fund Size: Rs. 43,359.16 Crore
- 1-Year Returns: 23.18%
- 3-Year Returns: 16.56%
- 5-Year Returns: 17.2%
4. SBI - ETF Nifty Next 50
The SBI - ETF Nifty Next 50 tracks the performance of the Nifty Next 50 index, which comprises 50 companies from the Nifty 100 index after excluding those that appear in the Nifty 50 index. The ETF offers exposure to emerging large-cap and mid-cap companies and provides an opportunity to invest in potential future market leaders.
Key Metrics
- Net Asset Value (NAV): Rs. 757
- Expense Ratio: 0.15%
- Fund Size: Rs. 2,859.73 Crore
- 1-Year Returns: 66.02%
- 3-Year Returns: 23.82%
- 5-Year Returns: 22.67%
5. LIC MF ETF - Nifty 100
Managed by LIC Mutual Fund, the LIC MF ETF - Nifty 100 tracks the performance of the Nifty 100 index. The fund comprises 100 of the top companies in terms of total market capitalisation listed on the National Stock Exchange. Around 73.26% of the ETF’s total funds are invested in large-cap companies and about 8.79% in mid-cap companies. The LIC MF ETF - Nifty 100 is one of the best exchange-traded funds in India for investors seeking exposure to both Nifty 50 and Nifty Next 50 companies.
Key Metrics
- Net Asset Value (NAV): Rs. 272
- Expense Ratio: 0.28%
- Fund Size: Rs. 717.26 Crore
- 1-Year Returns: 32.28%
- 3-Year Returns: 17.73%
- 5-Year Returns: 18.04%
6. Motilal Oswal Midcap 100 ETF
The Motilal Oswal Midcap 100 ETF tracks the performance of the Nifty Midcap 100 index. The fund provides exposure to 100 mid-cap stocks, making it one of the best exchange-traded funds for investors looking to tap into the growth potential of mid-sized companies. About 46.93% of the ETF’s funds are invested in mid-cap companies, 13.29% in large-cap companies, and 13.38% in small-cap entities.
Key Metrics
- Net Asset Value (NAV): Rs. 60.60
- Expense Ratio: 0.23%
- Fund Size: Rs. 471.74 Crore
- 1-Year Returns: 56.8%
- 3-Year Returns: 27.78%
- 5-Year Returns: 28.42%
7. Nippon ETF Dividend Opportunities
This ETF, managed by Nippon India Mutual Fund, focuses entirely on high dividend-yielding stocks. It tracks the performance of the Nifty Dividend Opportunities 50 index, which comprises 50 of the top dividend-yielding stocks listed on the National Stock Exchange. The fund is designed for income-oriented investors also looking for potential capital appreciation. Around 75.73% of the ETF’s total funds are invested in large-cap stocks, 15.89% in mid-cap stocks, and 1.98% in small-cap stocks.
Key Metrics
- Net Asset Value (NAV): Rs. 84.80
- Expense Ratio: 0.37%
- Fund Size: Rs. 56.09 Crore
- 1-Year Returns: 52.7%
- 3-Year Returns: 27.45%
- 5-Year Returns: 23.63%
8. Motilal Oswal NASDAQ 100 ETF
The Motilal Oswal NASDAQ 100 ETF is one of the few exchange-traded funds in India to offer exposure to stocks listed in the U.S. market. The fund tracks the performance of the NASDAQ 100 index, which comprises the top 100 companies in terms of market capitalisation listed on the NASDAQ stock exchange. This ETF is ideal for investors looking to add global tech exposure to their portfolio and benefit from the growth of the world's leading technology companies.
Key Metrics
- Net Asset Value (NAV): Rs. 163
- Expense Ratio: 0.58%
- Fund Size: Rs. 7,988.16 Crore
- 1-Year Returns: 31.26%
- 3-Year Returns: 15.59%
- 5-Year Returns: 25.75%
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Nippon ETF Gold BeES
The Nippon ETF Gold BeES is one of India's most popular gold ETF funds. It provides investors with exposure to gold prices without the need to physically own the metal. The ETF is an excellent investment option for those looking to protect their investment portfolio from rising inflation and market volatility. Each unit of this ETF is backed by physical gold, which ensures safety and transparency.
Key Metrics
- Net Asset Value (NAV): Rs. 62.55
- Expense Ratio: 0.79%
- Fund Size: Rs. 11,144.51 Crore
- 1-Year Returns: 23.47%
- 3-Year Returns: 14.08%
- 5-Year Returns: 14.75%
9. Kotak Nifty Bank ETF
The Kotak Nifty Bank ETF is a sector-specific exchange-traded fund that tracks the performance of the Nifty Bank index. The fund aims to provide investors with focused exposure to India’s banking sector. It comprises both private and public-sector banks. Considering the importance of banking in India's economy, this ETF could be a valuable addition to a diversified portfolio. Around 64.88% of the fund’s total assets are invested in large-cap stocks and about 6.37% in the mid-cap segment.
Key Metrics
- Net Asset Value (NAV): Rs. 538.79
- Expense Ratio: 0.16%
- Fund Size: Rs. 6,182.46 Crore
- 1-Year Returns: 16.62%
- 3-Year Returns: 14.33%
- 5-Year Returns: 11.61%
10. SBI - ETF 10Y Gilt
The SBI - ETF 10Y Gilt could be a good ETF investment for investors looking to gain exposure to long-term government securities, more specifically those with a 10-year maturity period. The fund tracks the performance of the Nifty 10 Year Benchmark G-Sec index, offering the potential for steady returns with relatively low investment risk. Investors may consider including this fund as part of their portfolio to balance their equity exposure and offset some risk.
Key Metrics
- Net Asset Value (NAV): Rs. 233.50
- Expense Ratio: 0.14%
- Fund Size: Rs. 2,957.27 Crore
- 1-Year Returns: 7.22%
- 3-Year Returns: 4.53%
- 5-Year Returns: 4.69%
12. Nippon India ETF Nifty 1D Rate Liquid BeES
Liquid BeES from Nippon India Mutual Fund is a unique ETF that invests in highly liquid money market instruments. The fund is designed to provide returns similar to overnight rates while maintaining high liquidity. Investors looking to park funds for the short term can consider investing in this exchange-traded fund. All of the funds in this ETF are used to invest in TREPS, or Treasury Bill Repurchase Agreements, which are ultra-liquid short-term money market securities.
Key Metrics
- Net Asset Value (NAV): Rs. 1,000
- Expense Ratio: 0.69%
- Fund Size: Rs. 12876.42 Crore
- 1-Year Returns: 4.82%
- 3-Year Returns: 4.08%
- 5-Year Returns: 3.17%
13. ICICI Prudential NV20 ETF
The ICICI Prudential NV20 ETF tracks the performance of the Nifty50 Value 20 index, which consists of 20 stocks from the Nifty 50 index selected based on their value characteristics. The fund is ideal for investors looking to gain exposure to undervalued stocks relative to their fundamentals.
Key Metrics
- Net Asset Value (NAV): Rs. 15.50
- Expense Ratio: 0.25%
- Fund Size: Rs. 128.98 Crore
- 1-Year Returns: 38.10%
- 3-Year Returns: 21.78%
- 5-Year Returns: 23.16%
14. Kotak Nifty PSU Bank ETF
One of the many exchange-traded funds tracking the Nifty PSU Bank Index, this fund focuses specifically on public sector banks. It offers targeted exposure to government-owned banks in India, making it suitable for investors who believe in the long-term potential of India's public sector banking space. Of the total funds in the ETF, about 60.47% is invested in large-cap stocks, 20.98% in mid-cap stocks, and 4.64% in small-cap entities.
Key Metrics
- Net Asset Value (NAV): Rs. 728.99
- Expense Ratio: 0.49%
- Fund Size: Rs. 1,477.69 Crore
- 1-Year Returns: 67.25%
- 3-Year Returns: 45.14%
- 5-Year Returns: 19.38%
15. ICICI Prudential S&P BSE 500 ETF
This ETF tracks the S&P BSE 500 index, which represents about 95% of the total market capitalisation on the Bombay Stock Exchange. It offers one of the broadest market exposures available in India, including large-cap, mid-cap, and small-cap stocks. The ICICI Prudential S&P BSE 500 ETF is ideal for investors seeking comprehensive coverage of the Indian equity market in a single investment.
Key Metrics
- Net Asset Value (NAV): Rs. 38.55
- Expense Ratio: 0.32%
- Fund Size: Rs. 264.72 Crore
- 1-Year Returns: 37.92%
- 3-Year Returns: 19.89%
- 5-Year Returns: 156.93%
Note: All of the above values are valid as of July 19, 2024
Conclusion
Exchange-traded funds are a powerful investment option for building diversified portfolios. Since the fund is listed and traded on exchanges like stocks, tracking the ETF unit price is easy and transparent. It is worth noting that the ETFs listed above are merely illustrative, and there are numerous other options available on the market. Therefore, it is advisable to conduct your own research and compare different options before you commit your investment capital to a fund.
Disclaimer: INVESTMENT IN SECURITIES MARKET ARE SUBJECT TO MARKET RISKS, READ ALL THE RELATED DOCUMENTS CAREFULLY BEFORE INVESTING. The asset classes and securities quoted in the film are exemplary and are not recommendatory. SAMCO Securities Limited (Formerly known as Samruddhi Stock Brokers Limited): BSE: 935 | NSE: 12135 | MSEI- 31600 | SEBI Reg. No.: INZ000002535 | AMFI Reg. No. 120121 | Depository Participant: CDSL: IN-DP-CDSL-443-2008 CIN No.: U67120MH2004PLC146183 | SAMCO Commodities Limited (Formerly known as Samruddhi Tradecom India Limited) | MCX- 55190 | SEBI Reg. No.: INZ000013932 Registered Address: Samco Securities Limited, 1004 - A, 10th Floor, Naman Midtown - A Wing, Senapati Bapat Marg, Prabhadevi, Mumbai - 400 013, Maharashtra, India. For any complaints Email - grievances@samco.in Research Analysts -SEBI Reg.No.-INHO0O0005847
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