Introduction to ETFs

If you are interested in investing, it's likely that you have come across the term 'ETF'. Exchange-traded funds (ETFs) are a basket of stocks that trades just like an individual company's stock. An ETF usually tracks an index, such as the Nifty or the Sensex. Thus, ETFs combine the features of a stock and a fund. The first ETF was launched in India in 2001, but it was not until 2015 that ETFs started gaining traction. Over the last five years, the assets managed by them has grown at an annual rate of 53 per cent, from over Rs 51,700 crore in April 2017 to over Rs 4.32 lakh crore in April 2022. In August of 2020, assets managed by the ETFs tracking the Nifty 50 Index crossed the milestone of Rs 1 lakh crore. The Indian mutual fund industry today has 134 ETFs across three different asset

This article was originally published on December 04, 2021.