India is a ‘perfect’ emerging market for investors, ETF expert suggests (2024)

FAQs

Is India a good emerging market to invest in? ›

“India has been a really good example of what can go right in an emerging market,” says Rahul Sharma, a portfolio manager of the Cullen Emerging Markets High Dividend fund. That fund's India weighting is about 16%. He credits Modi and the government for “putting together very sound economic development policies.”

Since India's economy is diverse and encompasses various sectors such as technology, finance, manufacturing and consumer goods, India ETFs are arguably the ideal investment choice.

Yes, Indians can invest in the US stock market. There is more than one way to buy and hold US stocks in your portfolio. Direct equities, ETFs, and mutual funds are just one of the few popular options. You can invest in US stocks in two ways from India – indirect and direct.

What should people know about India's equity markets? GUPTA: They're deep, liquid, mature and well diversified across sectors and company types. The market tends to have a growth tilt, which makes sense for an emerging markets with an elevated growth outlook and opportunities driven by domestic consumption.

The main features that characterise India as an emerging market: Rapid economic growth in recent years. Emerging middle class with growing purchasing power. Modern sectors such as IT, pharmaceuticals and the automotive industry are strongly represented.

Key Takeaways. ETFs are considered to be low-risk investments because they are low-cost and hold a basket of stocks or other securities, increasing diversification. For most individual investors, ETFs represent an ideal type of asset with which to build a diversified portfolio.

The future of ETFs in the Indian market is likely to witness the expansion of investment opportunities. As the ETF industry matures, new ETFs are being introduced that cover a broader range of asset classes, sectors, and thematic investment strategies.

ETFs are more liquid than mutual funds because of their structure and the fact that you can sell them like stocks on stock exchanges during trading hours. Also, as ETFs are traded on stock exchanges, they get an active secondary market that enables you to execute trade efficiently.

The US offers stability, a mature market, and transparent legal systems, making it an attractive option for risk-averse investors. On the other hand, India presents exciting growth prospects, but the regulatory landscape and potential volatility require a more strategic and informed approach.

Is it better to invest in India or USA for NRI? ›

Exchange Rate: Despite India's strong market performance, the depreciating Indian rupee poses a challenge and the weakens the argument for investing in India as the dollar strengthens, especially if you are looking to repatriate the returns(gains) back to US.

Investments in the US market may offer stability and dividend income, while the Indian market provides the allure of higher capital appreciation fueled by a youthful population, urbanization, and increasing consumption.

The US offers stability, a mature market, and transparent legal systems, making it an attractive option for risk-averse investors. On the other hand, India presents exciting growth prospects, but the regulatory landscape and potential volatility require a more strategic and informed approach.

Several commentators suggest that India has the potential to become a global superpower, a state with an extensive ability to exert influence or to project power in much of the world. Factors that contribute to a nation acquiring such a status can be economic, political, demographic, military, and cultural.

Numerous industrial zones, workforce and labor availability, lower labor costs, and a relatively open environment for foreign direct investments. India's large labor and consumer base, low operating costs, and linkages to important international markets.