5 Best Indian ETFs to Buy for Q3 2024

By:

Crispus Nyaga

Crispus is a Financial Analyst for Invezz covering the stock, cryptocurrency and forex markets. He’s an experienced analyst with more than 8 years of industry experience.... read more.

 & 

James Knight

James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.

Updated: Jul 8, 2024

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India is one of the world’s largest emerging markets with a strong, growing economy. Investing in ETFs is the easiest way to capitalise on future growth and in this guide, we compare the best Indian ETFs to invest in right now.  

What are the top Indian ETFs to buy?

1. First Trust India NIFTY 50 Equal Weight ETF (NFTY)

• Assets: $243 million
• Expense ratio: 0.80%
• Year of inception: 2012
• 5-year performance: 60%
• Dividend yield: 0.23%

The First Trust India NIFTY 50 Equal Weight ETF is regarded as one of the top Indian ETFs available and exposes investors to the Indian equity market. NFTY tracks the NIFTY 50 Equal Weight Index, which consists of 50 of the biggest Indian companies listed on the National Stock Exchange of India (NSE).

The biggest companies in the ETF are the likes of UltraTech Cement, Reliance Industries, LTIMindtree, Grasim Industries, Bharti Airtel, and Bharat Petroleum. It is a fairly balanced ETF, with most companies having a 2% stake in the fund. The top ten companies account for just 20% of its total holdings.

With its diversified portfolio and equal-weighting methodology, it provides exposure to a broad range of Indian companies while mitigating concentration risks. By investing in the NFTY ETF, investors can capitalise on India’s economic growth potential and benefit from a well-rounded investment in one of the best India ETFs available.

2. Columbia India Consumer ETF (INCO)

• Assets: $341 million
• Expense ratio: 0.75%
• Year of inception: 2011
• 5-year performance: 69%
• Dividend yield: 3.20%

The Columbia India Consumer ETF gives investors access to the Indian consumer sector. INCO tracks the performance of the Indxx India Consumer Index, which includes companies operating in retail, media, healthcare, and consumer goods industries.

INCO holds just 15 companies in its portfolio, with the biggest names being the likes of Godrej Consumer Products, Nestle India, Britannia, Bajaj Auto, and Samvardhana Motherson International. The first two companies account for about 25% of the fund while the first ten account for 90% of the fund.

With a significant focus on consumer discretionary, consumer staples, and healthcare sectors, INCO effectively manages concentration risks and allows investors to capitalise on India’s growing consumer-driven economy. The key cons for the fund is that it has concentration risks and that its expense ratio is a bit big.

3. iShares MSCI India Small-Cap ETF (SMIN)

• Assets: $959 million
• Expense ratio: 0.79%
• Year of inception: 2012
• 5-year performance: 109%
• Dividend yield: 0.35%

Third place on our best Indian ETFs for 2024 is the iShares MSCI India Small-Cap. This ETF tracks the performance of the MSCI India Small Cap Index, which includes small-cap companies in India, offering investors access to the small-cap segment of the Indian equity market. It holds 506 companies, with most of them being industrials, financials, consumer cyclicals, and basic materials.

SMIN is comprised of some of India’s most promising small publicly traded companies, including Dixon Technologies, Voltas, The Federal Bank, and Embassy Office Parts. With its portfolio composition, the ETF offers diversification within the small-cap space and covers various sectors such as consumer discretionary, financials, and industrials.

The iShares MSCI India Small-Cap ETF has a well-balanced sector weighting meaning investors can benefit from the growth potential of different industries within India’s small-cap segment. By investing in the iShares MSCI India Small-Cap ETF, investors can gain exposure to the dynamic small-cap sector of the Indian equity market and diversify their portfolios, making it one of the best Indian ETFs available for long-term growth potential.

4. VanEck Digital India ETF (DGIN)

• Assets: $25.50 million
• Expense ratio: 0.76%
• Year of inception: 2022
• 5-year performance: N/A
• Dividend yield: 0.22%

As its name suggests, the VanEck Digital India ETF provides investors with exposure to India’s digital economy. The ETF aims to track the MVIS India Digital Transformation Index’s performance, which comprises companies operating in sectors such as e-commerce, digital payments, and technology services. 

DGIN invests in a diverse range of companies that are at the forefront of India’s digital revolution. Some of its best-known holdings include Infosys, Tata Consultancy Services, and HCL Technologies. It ensures diversification by allocating investments across various sectors, including information technology, consumer discretionary, and communication services.

With its strategic sector weighting, the VanEck Digital India ETF allows investors to participate in the growth potential of different industries within India’s digital economy. As India continues to embrace digital transformation and rapid technological advancements, DGIN looks well placed to capitalise on future growth. 

5. Nifty India Financials ETF (INDF)

• Assets: $10.6 million
• Expense ratio: 0.75%
• Year of inception: 2020
• 5-year performance: N/A
• Dividend yield: 7.9%

The Nifty India Financials ETF is one of the best funds for gaining exposure to the Indian financial sector. It aims to closely track the performance of the Nifty Financial Services Index, which comprises some of India’s leading financial institutions and companies.

This ETF offers a diversified portfolio of various Indian financial firms, including names in banking, insurance, and non-banking financial services. Some of its significant holdings include HDFC Bank, ICICI Bank, and Bajaj Finance. Investing in the ETF allows investors to access a broad range of financial companies, ensuring diversification within the sector.

The Nifty India Financials ETF allows investors to tap into the growth potential of India’s robust financial industry. India’s financial sector has experienced substantial growth in recent years, fueled by increasing consumer spending and expanding banking services. Investing in Nifty India Financials allows investors to participate in this growth trajectory, making it a top choice for anyone seeking the best Indian ETFs in the financial sector. It is also a great ETF because of its strong dividend, whose yield stands at 7.9%.

Where to buy the best Indian ETFs

You can buy any ETFs on our list using the brokers below. Our experts have selected these platforms; they are the best options for beginners and experienced investors. Click on any of the links below to open an account in just a few minutes. 

Most popular

1

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Bank Transfer, Debit Card, PayPal, Credit Card, Visa, Mastercard, American Express, Trustly, Apple Pay, Google Pay, Discover, Bank Transfer: SEPA, Bank Transfer: FPS, skrill

Full Regulations:

ASIC, FCA, FSA, MAS, CySEC #250/14

Buy or sell stock CFDs with Plus500. 82% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

2

Min. Deposit

$ 0

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Get insights from millions of investors, creators, and analysts

Build your portfolio of stocks, ETFs, and crypto–all in one place

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Payment Methods:

Debit Card, Wire Transfer, Check, Bank Wire

Full Regulations:

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Payment Methods:

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Full Regulations:

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

What is an Indian ETF?

It’s an exchange traded fund that aims to replicate or track the performance of a specific sector of the Indian economy. ETFs are traded on stock exchanges and provide investors with a convenient way to gain exposure to a diversified portfolio of Indian stocks. By investing in the best Indian ETFs, investors can access the growth potential of companies and sectors without buying individual stocks directly. 

Are Indian ETFs a good investment?

Yes, Indian ETFs can be a good investment choice and are especially useful for investors wanting to diversify their portfolios by investing in the Indian market. India has a strong economy that is in a growth phase and the best Indian ETFs can make it easy to capitalise on any future growth. 

Indian ETFs offer a convenient way for investors to tap into this potential, as they provide exposure to a broad range of Indian companies and sectors within a single investment. By spreading investments across multiple stocks, these ETFs help mitigate the risks associated with individual companies, making them a good option for those seeking diversification without extensive research or stock selection.

Like other emerging markets, things can change quickly, so staying updated with the latest news and market developments is a good idea. You can use any of the links below to read the most current news from industry experts. You’ll also need to use a broker that offers the best Indian ETFs and you can click the blue button to find the right platform for you. 

Methodology: How we choose the best India ETFs

At Invezz, we are dedicated to helping investors make informed decisions by providing authoritative, accessible, and engaging advice and recommendations. Our curated section of the best Exchange-Traded Funds (ETFs) is carefully selected by our team of experienced market analysts and reviewed by a sub-editor. This methodology outlines the rigorous process we follow to ensure our ETF recommendations are up-to-date, reliable, and insightful.

• Analyst research & recommendations: Our seasoned market analysts use their in-depth sector knowledge to identify ETFs with strong potential, ensuring they meet high standards of performance, liquidity, and market potential.
• ETF evaluation: We evaluate ETFs based on their underlying assets, historical performance, expense ratios, and tracking accuracy, alongside macroeconomic factors and sector trends.
• Fund performance reports: We assess ETFs through the latest performance reports, analyzing key metrics like returns, volatility, expense ratios, and assets under management (AUM).
• Sector analysis and external recommendations: Our detailed sector analysis, combined with recommendations from reputable sources like Barron’s and Zacks, provides an additional layer of validation for our selections.
• Quarterly review & refresh: We update our curated ETF list quarterly, re-evaluating each ETF based on the latest reports, industry developments, and market conditions to ensure our recommendations reflect the most current information available.