Skip to main content

MSCI Index ETF


For investors tired of buying Sensex and Nifty exchange traded funds (ETFs), there's might be a new option


For investors tired of buying Sensex and Nifty exchange traded funds (ETFs), there's a new option on the cards. HDFC AMC has filed a draft document for an MSCI India Index based ETF with market regulator Sebi. If the product gets the green signal, this could be an interesting new addition to 20-odd ETFs already in the market.

Since ETFs are passive investment vehicles, they are only as good as the underlying index they track. Most of the ETFs currently available in the market track the Sensex and the Nifty. There are a few which mimic thematic or strategy indices like Nifty Dividend Opportunities 50, Nifty Next 50, Nifty Free Float Midcap 100, Nifty Bank, BSE 100, CNX 100, and overseas benchmarks like Nasdaq 100.


So, how different is the MSCI India Domestic Index? The 84-constituent MSCI India Domestic Index is designed to measure the performance of the large and mid cap segments of the Indian market. The index is based on the MSCI Global Investable Market Indexes and uses the Domestic Inclusion Factor (DIF) as the free-float adjustment factor for the market capitalization of each security. Simply put, if you invest in an ETF based on the MSCI India Domestic Index, you can get a wider representation of the Indian market.


It is estimated that about 70-80% of the money flowing into India is from investors who use MSCI's benchmark indices. Because MSCI is the de facto global standard in the index business, an ETF based on MSCI's India index is likely to find good traction. An India-based ETF could also help foreign investors sidestep the cap on FII ownership in individual stocks.


The MSCI India Domestic Index's top 10 constituents are HDFC Bank (Financials), HDFC (Financials), Infosys (Info Tech), ITC (Consumer Staples), RIL (Energy), ICICI Bank (Financials), TCS (Info Tech), L&T (Industrials), Tata Motors (Consumer Discretionary) and Axis Bank (Financials). These 10 stocks make for nearly 45% of its weight, as per its latest update.


From a sectoral point of view, the MSCI India Domestic index is heavily inclined towards Financials (31.36%), Infotech (13.21%) and Consumer Discretionary (11.53%). It also has exposure to Consumer Staples, Energy, Materials and Healthcare between 7-10%. Industrials, Utilities and Telecommunication Services each have less than 5% share.


An index is as good as its performance. The MSCI India Domestic Index has performed better than the Sensex in recent years. MSCI India Domestic Index, in INR terms, grew by 4.54% in 2016 when Sensex inched up by just 1.95%. In 2015, the index dipped by 1.17% compared to a steeper 5.03% drop in Sensex. A year before, i.e. 2014, when the Sensex rose by 29.89%, MSCI India Domestic Index jumped by 35%. However, the index under-performed Sensex in 2011, 2012 and 2013.


Year Sensex MSCI India Domestic Index
2009 81.03 88.82
2010 17.43 18.04
2011 -24.64 -25.17
2012 25.7 33.51
2013 8.98 7.75
2014 29.89 35
2015 -5.03 -1.17
2016 1.95 4.54
Source: BSE, MSCI





Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds

Top 4 Tax Saver Mutual Funds for 2017 - 2018

Best 4 ELSS Mutual Funds to invest in India for 2017

1. DSP BlackRock Tax Saver Fund

2. Invesco India Tax Plan

3. Tata India Tax Savings Fund

4. BNP Paribas Long Term Equity Fund



Invest in Best Performing 2017 Tax Saver Mutual Funds Online

Invest Best Tax Saver Mutual Funds Online

Download Top Tax Saver Mutual Funds Application Forms


For further information contact SaveTaxGet Rich on 94 8300 8300


Leave your comment with mail ID and we will answer them

OR

You can write to us at

Invest [at] SaveTaxGetRich [dot] Com

OR

Call us on 94 8300 8300


 

Popular posts from this blog

Tata Mutual Fund

Being a part of the Tata group, the fund has the backing of a very trusted brand name with strong retail connect. While the current CEO has done an excellent job in leveraging the Tata brand name to AMC's advantage, it is ironic that this was just not capitalised on at the start. Incorporated in 1995, Tata Mutual Fund remained an 'also-ran' fund house for around eight years. Till March 2003, it had a little over Rs 1,000 crore in assets and 19 AMCs were ahead of it. But soon after that the equation changed. It was the fastest growing fund house in 2004 and 2005. During these two years, it aggressively launched six equity funds, two debt funds and one MIP. The fund house as of now stands at No. 8 in terms of asset size. This fund house has a lot to offer by way of choice. And, it also has a number of well performing schemes. Tata Pure Equity, Tata Equity PE and Tata Infrastructure are all good funds. It also has quite a few good debt funds. The funds of Tata AMC are known to...
Read more

UTI Mutual Fund

Even though only a few of UTI’s funds are great performers, this public sector fund house has many advantages that its rivals do not. It has a huge base of retail equity investors and a vast distribution network. As a business, it looks stronger than ever, especially in the aftermath of credit crunch. UTI is, by a large margin, the most profitable fund company in the country. This is not surprising, since managing equity funds is more profitable than debt. Its conservative approach and stable parentage is likely to make it look more attractive to investors in times to come. UTI’s big problem is the dragging performance that many of its equity funds suffer from. In recent times, the management has made a concerted effort to improve performance. However, these moves have coincided with a disastrous phase in the stock markets and that has made it impossible to judge whether the overhaul will eventually be a success. UTI’s top performers are a few index funds, some hybrid funds and its inf...
Read more

Salary planning Article

1. The salary (basic + DA) should be low. The rest should come by way of such allowances on which the employer pays FBT and you don't pay any tax thereon. 2. Interest paid on housing loan is deductible u/s 24 up to Rs 1.5 lakh (Rs 150,000) on self-occupied property and without any limit on a commercial or rented house. 3. The repayment of housing loan from specified sources is also deductible irrespective of whether the house is self-occupied or given on rent within the overall ceiling of Rs 1 lakh of Sec. 80C. 4. Where the accommodation provided to the employee is taken on lease by the employer, the perk value is the actual amount of lease rental or 20 per cent of the salary, whichever is lower. Understandably, if the house belongs to a family member who is at a low or nil tax zone the family benefits. Yes, the maximum benefit accrues when the rent is over 20 per cent of the salary. 5. A chauffeur driven motor car provided by the employer has no perk value. True, the company would...
Read more

8 Investing Strategy

The stock market ‘meltdown’ witnessed since the start of 2005 (notwithstanding the recent marginal recovery) has once again brought to the forefront an inherent weakness existent in our markets. This is the fact that FIIs, indisputably and almost entirely, dominate the Indian stock market sentiments and consequently the market movements. In this article, we make an attempt to list down a few points that would aid an investor in mitigating the risks and curtailing the losses during times of volatility as large investors (read FIIs) enter and exit stocks. Read on Manage greed/fear: This is an important point, which every investor must keep in mind owing to its great influencing ability in equity investment decisions. This point simply means that in a bull run - control the greed factor, which could entice you, the investor, to compromise with your investment principles. By this we mean that while an investor could get lured into investing in penny and small-cap stocks owing to their eye-...
Read more

Debt Funds - Check The Expiry Date

This time we give you an insight into something that most debt fund investors would be unaware of, the Average Portfolio Maturity. As we all know, debt funds invest in bonds and securities. These instruments mature over a certain period of time, which is called maturity. The maturity is the length of time till the principal amount is returned to the security-holder or bond-holder. A debt fund invests in a number of such instruments and each of these instruments would be having different maturity times. Hence, the fund calculates a weighted average maturity, which would give a fair idea of the fund's maturity period. For example, if a fund owns three bonds of 2-year (Rs 30,000), 3-year (Rs 10,000) and 5-year (Rs 20,000) maturities, its weighted average maturity would be 3.17 years. What is the big deal about average maturity then, you may ask. Well, knowing a fund's average maturity is important because it tells you how sensitive a fund is to the change in interest rates. It is ...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now