Even as net flows into smallcap funds in March turned negative, for the first time in 30 months, they remained a big draw for new investors. The smallcap fund category saw a net of 360,000 investment accounts, or folios, getting added last month, the second-most among all active equity categories. Smallcap funds' continued traction could be driven by their strong performance across timeframes, say experts.
These ETFs will also carry interest-rate risk, especially the 10-year ETF. The investor can overcome this risk by holding them till maturity, suggests Sanjay Kumar Singh.
'In phases when smaller stocks do well, an equal-weight index performs better than its market cap-weighted peer.'
Equity mutual funds witnessed an inflow of Rs 35,943 crore in November, marking a drop of 14 per cent on a month-on-month basis, amid heightened volatility in stock markets driven by various macroeconomic factors, geopolitical events and US election results. Despite this, it marked the 45th consecutive month of net inflows into equity-oriented funds, reflecting the growing popularity of mutual funds among investors, according to data from the Association of Mutual Funds in India (AMFI) released on Tuesday.
ETFs may be an option if you are considering only large-cap funds, experts tell Tinesh Bhasin.
ETFs (Exchange Traded Funds), have already become extremely popular investment vehicles in developed markets, though back home they are yet to make any tangible headway.
'By investing in a basket of funds, FoFs can help minimise the impact of underperforming funds, thus reducing overall investment risk.'
HDFC Bank's latest shareholding data showed that the room for foreign investment has fallen just 5 basis points short of the threshold set by Morgan Stanley Capital International (MSCI) to fully include the stock in its indices. Currently, the index provider has applied an adjustment factor of 0.5 since the foreign room is less than 25 per cent. Removal of the adjustment factor will result in inflows of a massive $4.8 billion (Rs 40,000 crore) into HDFC Bank, according to Brian Freitas, a New Zealand-based analyst with Periscope Analytics.
Investing in ETFs is similar to buying and selling shares on exchanges through your trading account, points out Ashwani Bhatia, MD and CEO, SBI Mutual Fund.
Gold, a safe-haven bet, is likely to continue its record-smashing journey in the New Year, rising to Rs 85,000 per 10 grams and even Rs 90,000 level in domestic markets if geopolitical tensions and global economic uncertainties continue.
Investors should match their investment horizon with the fund's portfolio duration.
While the minimum holding period for LTCG taxation has now been lowered, the tax outgo could be a bit higher under the new structure.
If you already hold significant amounts of equity in your portfolio, avoid MAAFs with over 60 per cent equity. But if you lack equity exposure, an aggressive MAAF may be appropriate.
If one compares returns, the two public-sector ETFs have done better over the past year, but the ELSS category has done better over the trailing three and five years.
Funds collected by the mutual fund will be invested in gold and hence the net asset value of the ETF will be largely dependent upon price of gold minus the administrative costs of the AMC and the mutual fund.
Experts attributed the inflows to sudden rally in gold prices, mainly due to uneasy trade negotiations between the US and China and lower than expected global GDP growth.
'Value index funds are most appropriate for long-term investors who can withstand deeper drawdowns.'
Only investors with knowledge of cryptocurrencies, long-term conviction, and a long horizon should invest in this asset class.
An ETF is an investment fund traded on stock exchanges, much like stocks. An ETF holds assets such as stocks, commodities or bonds.
'If you invest in sovereign gold bond, you are going to get the price rise of gold over an eight year period.' 'You're also going to get that two-and-a-half percent which the Government of India is willing to give you, treating the money that you've invested in the sovereign gold bond as a kind of a FD or a deposit.' 'That kind of return you can never get anywhere else.'
The inflows meant assets under management of gold ETFs climbed by over 4 per cent to Rs 13,503 crore at the end of August from Rs 12,941 crore at July-end.
If investing in Bitcoin, adopt a three to five-year horizon and invest systematically to gain from its volatility.
'Understand how wedding expenses fit into your overall financial situation.' 'Evaluate how different levels of spending will impact other goals like retirement, travel, or housing.'
Investors may take a 5 to 10 per cent exposure to silver. 'Have a long-term investment horizon when investing in silver ETFs to ride out short-term market fluctuations.'
Indian retail investors continue to sell gold ETFs.
One risk of investing in a very low-cost ETF is if a fund house runs it at below cost, it could close it if it fails to attract institutional money
Commodity ETFs (exchange traded funds) attempt to track the price of a single commodity, such as gold or oil, or a basket of commodities by holding the actual commodity in storage, or by purchasing futures contracts.
Understand the pros and cons of SGBs before rushing to invest in them based on past returns.
Given that the ETF has given exceptional returns over the past year, start small and buy more in a staggered manner.
The mutual fund industry's QAAUM (Quarterly Average Assets Under Management) was up 37 per cent year-on-year (Y-o-Y) (9 per cent Q-o-Q) to hit Rs 59 trillion (end Q1FY25). The equity segment grew 55 per cent Y-o-Y and equity formed 56 per cent of total AUM, up 49 per cent in Q1FY24. Sequentially, AUM grew by Rs 5 trillion.
Do a proper asset allocation and invest through systematic investment plans where one can benefit.
'A 10 to 15 per cent allocation to gold in portfolios reduces risk without compromising on potential returns.'
Momentum funds can be 10 to 15 per cent more volatile than the Nifty 50.
EPFO had started investing ETFs in August last year.
The exchange traded fund (ETF), the most exciting investment in the market, is capable of giving sweeping returns.
A delegation of high-level executives from US public pension funds (non-profit and government sectors) is visiting India next week to assess and familiarise themselves with the investment opportunities in the country. These executives belong to various American states and cumulatively represent $1.8 trillion in assets under management (AUM) invested across the US and global markets. The United States (US) mission to India, which includes its embassy and consulates and the Department of Treasury, along with India's Ministry of Finance and the National Investment and Infrastructure Fund (NIIF), is hosting the delegation.
Investors should use a mix of active and passive funds.
In their short history, Gold ETFs have been quite successful in capturing investors' fancy. It must be noted that while ETFs as investment avenues may not be very popular among investors, it is the Gold ETFs segment wherein the interest is palpable. The fact remains that Gold ETFs are like any other investment avenues and have their fair share of pros and cons. This in turn highlights the need for investors to properly evaluate the Gold ETF option.
Commodity investments can help you diversify your portfolio in asset classes other than equity and debt, says Dwaipayan Bose.
A key reason for the rise in crypto currencies in 2023 is the possibility of the world's first Bitcoin ETF over the next few months.
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