Exchange Traded Funds are mutual fund schemes that typically mimic/track their underlying benchmark index, sector, commodity, or other assets. Unlike traditional mutual funds, ETFs can be bought and sold on the exchange the same way that regular shares can be traded on the exchange.
Smooth buying/selling of ETFs at
Detailed overview of your holdings
Buy ETFs from a list of options available for investments
|Fund Name||TER(%)*||AUM(Crs)#||Last Traded Price**||1 Year Returns(%)||3 Year Returns(%)||5 Year Returns(%)|
|SBI Nifty ETF||0.07||1,22,898||171.99||1.60||11.37||11.90|
|Kotak Nifty Bank ETF||0.18||6,024||370.84||-3.40||2.12||7.44|
|Nippon India ETF Gold BeES||0.83||6,683||43.71||8.06||12.74||10.72|
|ICICI Prudential S&P BSE Liquid Rate ETF||0.25||3,548||1,000.00||3.25||3.24||--$|
There are 5 types of ETFs in India - Equity, Debt, Gold, Global and Smart beta
|Feature||ETFs||Securities||Traditional Mutual Fund|
|Real-time trading and pricing during market hours|
|Convenience of putting limit orders|
|Ability to be traded real-time on the Stock Exchange|
|Arbitrage between Futures and Cash Market|
|Diversification possible with a single unit|
|Returns in sync with the market/ benchmark index||*|
The tax on redemption of equity ETFs depends on holding period. If the holding period is more than a year, then there is long-term capital gain. It is exempt if the gain is up to Rs.1 lakh. For long-term capital gain of above Rs.1 lakh, the tax liability is 10% without indexation benefits. However, if the holding period is less than 12 months, then 15% tax liability arises from short-term capital gain.
In ETF (other than equity) and FOF, if the holding period is less than 36 months, there is short-term capital gain. Income from such sales is included in the normal income, and tax is calculated as per normal slab rates. Also, the tax liability of 20% (with indexation benefits) is calculated if long-term capital gain arises from selling such assets. The FOFs are treated as debt funds regardless of any of the schemes they invest in.
While ETFs have a low expense ratio, they do have some charges that are specific to them. Because ETFs, like stocks, are purchased as shares through a broker, an investor must pay a brokerage commission each time he or she makes a purchase. In addition, an investor may incur the standard fees of stock trading, such as disparities in the ask-bid spread and so on. Traditional mutual fund investors, on the other hand, are indirectly susceptible to the same trading charges because the fund pays for them.
ETFs have specific risks in spite of their diversification benefits. Generally, the risk associated with investing in ETFs are broadly classified into: