In a sign of growing investor interest in exchange-traded funds (ETFs), their asset base on the National Stock
Exchange’s Nifty 50 has surpassed the Rs 10,000-crore mark.Assets Under Management (AUM) of ETFs based on Nifty 50 index has surged to Rs 10,000 crore in India, the exchange said in a statement today.
It stood at Rs 8,533 crore as on March 31, and Rs 1,251 crore at the end of preceding financial year.
First ETF in India was launched in December 2001 which was based on Nifty 50. Currently there are 13 ETFs on Nifty 50 index listed in India.
“India is catching up with the global trend in ETF segment, where ETF industry is worth USD 3.2 trillion as on June 30, 2016. We are pleased to see a surge in investors’ interests in ETF products,” NSE Managing Director and CEO Chitra Ramkrishna said.
NSE has conducted around 950 awareness programs this year to engage investors for larger participation from the retail segment in ETF products.
“India specific products tracking Nifty indices are very popular among the global investors. In the past one year, we have seen very strong demand for Nifty 50 based products in Asian countries including Korea, Taiwan, Japan and Hong Kong,” Mukesh Agarwal CEO of IISL, an NSE group company said.
ETFs are group of securities which are traded like individual stocks on an exchange. They can track equity indices, bonds and commodities among others.
Moreover, a small time retail investor can buy ETFs for as little as about Rs 100 and these can be then bought and sold as a share on the exchange with a minimum trading lot of one unit and carry lower management costs when compared to mutual funds.
ETFs covering Nifty family of indices are traded in 19 exchanges covering 16 countries. Taiwan Stock Exchange is one of the latest exchanges to offer ETFs on Nifty 50.
Among the popular ETFs traded on the NSE platform are Nifty 50, Nifty Bank, Nifty CPSE, Nifty 100. A total of 33 out of 43 equity ETFs traded in India are benchmarked to Nifty family of indices.