Exchange-Traded Funds (ETFs) are investment funds traded on stock exchanges, much like stocks. They hold assets such as stocks, commodities, or bonds and typically operate with an arbitrage mechanism designed to keep trading close to its net asset value, though deviations can occasionally occur. Index funds, a type of ETF, aim to replicate the performance of a specific index, providing investors with broad market exposure, low operating expenses, and low portfolio turnover. Here, we explore various ETFs and their performance to give you a clearer understanding of these investment options.
Understanding ETFs and Index Funds
ETFs and index funds offer a way for investors to diversify their portfolios without having to pick individual stocks. These funds track specific indices, sectors, or themes, making it easier for investors to gain exposure to different parts of the market.
Key ETFs and Their Performance
1. Motilal Oswal BSE Enhanced Value ETF
– AUM: ₹80.26 crore
– Annualized Returns: 105.50% p.a.
– Growth: ▲93.1%
This ETF focuses on enhancing value by selecting stocks based on specific value criteria, showing significant returns.
2. Kotak Nifty Alpha 50 ETF
– AUM: ₹154.44 crore
– Annualized Returns: 54.80% p.a.
– Growth: ▲79.4%
This ETF tracks the Nifty Alpha 50 Index, which selects 50 stocks based on their alpha scores.
3. ICICI Prudential Nifty PSU Bank ETF
– AUM: ₹66.07 crore
– Annualized Returns: 73.29% p.a.
– Growth: ▲71.2%
This ETF invests in public sector banks listed on the Nifty PSU Bank Index, reflecting the sector’s strong performance.
4. Kotak Nifty PSU Bank ETF
– AUM: ₹1,580.70 crore
– Annualized Returns: 724.93% p.a.
– Growth: ▲70.7%
Similar to the ICICI Prudential Nifty PSU Bank ETF, this fund also focuses on public sector banks, offering robust returns.
5. Nippon India ETF Nifty PSU Bank BEES
– AUM: ₹2,734.96 crore
– Annualized Returns: 80.87% p.a.
– Growth: ▲70.7%
This ETF tracks the Nifty PSU Bank Index, providing substantial exposure to public sector banks.
6. Aditya Birla SL Nifty 200 Momentum 30 ETF
– AUM: ₹61.89 crore
– Annualized Returns: 36.22% p.a.
– Growth: ▲69.3%
This ETF targets stocks in the Nifty 200 Momentum 30 Index, focusing on companies with high momentum.
7. Motilal Oswal Nifty 200 Momentum 30 ETF
– AUM: ₹73.67 crore
– Annualized Returns: 36.45% p.a.
– Growth: ▲69.0%
Similar to the Aditya Birla SL Nifty 200 Momentum 30 ETF, this fund also focuses on momentum stocks.
8. ICICI Prudential Nifty 200 Momentum 30 ETF
– AUM: ₹176.74 crore
– Annualized Returns: 36.45% p.a.
– Growth: ▲69.0%
This ETF invests in high momentum stocks from the Nifty 200 Momentum 30 Index.
9. HDFC Nifty 200 Momentum 30 ETF
– AUM: ₹46.07 crore
– Annualized Returns: 36.02% p.a.
– Growth: ▲68.8%
Another momentum-focused ETF, providing exposure to companies with strong price momentum.
10. ICICI Prudential Nifty Auto ETF
– AUM: ₹66.37 crore
– Annualized Returns: 25.59% p.a.
– Growth: ▲67.9%
This ETF targets the automotive sector, tracking the Nifty Auto Index.
11. Nippon India Nifty Auto ETF
– AUM: ₹154.50 crore
– Annualized Returns: 255.91% p.a.
– Growth: ▲67.8%
Similar to the ICICI Prudential Nifty Auto ETF, this fund focuses on the auto sector.
12. Aditya Birla SL Nifty Next 50 ETF
– AUM: ₹72.72 crore
– Annualized Returns: 75.09% p.a.
– Growth: ▲66.2%
This ETF tracks the Nifty Next 50 Index, providing exposure to the next 50 largest companies after the Nifty 50.
13. UTI Nifty Next 50 ETF
– AUM: ₹2,375.37 crore
– Annualized Returns: 76.92% p.a.
– Growth: ▲66.1%
Similar to the Aditya Birla SL Nifty Next 50 ETF, offering exposure to the Nifty Next 50 Index.
14. SBI Nifty Next 50 ETF
– AUM: ₹2,655.92 crore
– Annualized Returns: 764.56% p.a.
– Growth: ▲66.1%
This ETF also focuses on the Nifty Next 50 Index, offering robust returns.
15. ICICI Prudential Nifty Next 50 ETF
– AUM: ₹637.35 crore
– Annualized Returns: 75.31% p.a.
– Growth: ▲66.1%
Another ETF tracking the Nifty Next 50 Index, providing investors with significant growth potential.
16. Nippon India ETF Nifty Next 50 Junior BeES
– Annualized Returns: 771.99% p.a.
– Growth: ▲66.0%
This ETF targets the Nifty Next 50 Index, offering substantial exposure to mid-cap companies.
Why Invest in ETFs?
1. Diversification: ETFs provide exposure to a wide range of sectors and indices, helping investors diversify their portfolios.
2. Lower Costs: Typically, ETFs have lower expense ratios compared to mutual funds, making them cost-effective.
3. Transparency: ETFs are traded on stock exchanges, and their holdings are publicly disclosed, offering transparency.
4. Flexibility: Investors can buy and sell ETFs throughout the trading day at market prices, providing liquidity and flexibility.
Considerations Before Investing
1. Market Risks: As with any investment, ETFs are subject to market risks. The value of an ETF can fluctuate based on market conditions.
2. Tracking Error: Sometimes, an ETF may not perfectly track its underlying index, leading to a tracking error.
3. Research: It’s essential to research and understand the ETF’s objectives, underlying index, and performance history before investing.
ETFs offer a convenient and efficient way for investors to gain exposure to a diverse range of sectors and indices. By understanding the different options and their performance, investors can make informed decisions that align with their financial goals and risk tolerance. Always consult with a financial advisor to ensure that your investments fit within your overall strategy.
