Australian ETF promoter BetaShares has launched its BetaShares India Quality ETF (IIND). Listed on the Australian Securities Exchange, IIND has an expense ratio of 0.8%.
IIND tracks the Solactive India Quality Select Index provided by the German-based index provider. It is comprised of 30 of India’s largest companies based on the following factors: high profitability, low leverage and high earnings stability.
India has been competing with China as one of the fastest growing economies in recent years after seeing its GDP grow 7.5% year-over-year for the last decade up to 2018. This rate is expected to continue for a further five years, according to the International Monetary Fund.
Franklin Templeton launched an India ETF back in June at a much cheaper price of 0.19%. Despite a strong global equity market, the Franklin FTSE India UCITS ETF (FRIN) hasn’t performed that well since its launch with its net asset value falling 3.7%.
The reason Indian equity has become such a popular exposure for investors is because of its low correlation with global stocks which is significant at a time of ongoing geopolitical events.
Timo Pfeiffer, head of research at Solactive, said in a statement: The Indian economy has further room to expand at higher-than-average growth rates.
“Although some points on the reform agenda will be painful and disruptive to the economy, like the banknote demonetisation in 2016, Modi and his government seem to take necessary and promising steps.”