India ETFs To Watch After China Rate Cut [iShares S&P India Nifty 50 Index Fund, EGA Emerging Global Shares Trust]

The fund charges 94 basis points as expenses and currently has a Zacks ETF Rank #1 or Strong Buy rating.

EGShares India Infrastructure Index Fund (INXX)

This fund provides exposure to the growing infrastructure corner of the broad Indian market by tracking the Indxx India Infrastructure Index. The fund holds a basket of 30 stocks with BhartiAirtel, Idea Cellular and Tata Motors as the top three holdings.  From an industry look, industrials take the top spot with 36%, closely followed by utilities (19%) and telecom (15.7%).

The fund has accumulated just $22.1 million in its asset base and trades in small volume of 30,000 shares a day on an average. The expense ratio comes in at 0.85%.

Though INXX is unpopular and expensive, the product has gained about 13.8% post-election results and 34% year to date. The fund has a Zacks ETF Rank of 2 with a medium risk outlook.

Bottom Line

Any rate cut by the RBI in its next policy review is expected to fuel a rally in the above mentioned ETFs.

However, a group of banking and rating organizations polled by Business Standard  lately are of the view that the RBI is unlikely to ease rates in its next monetary policy review this December but might consider raising it in April next year.

If that happens, we might see some kind of profit booking in the above mentioned ETFs. Nonetheless, long-term investors can still consider the above mentioned products, given the improving fundamentals of the Indian economy. Moreover, all of the above ETFs have a solid Zacks ETF Rank worthy of one’s portfolio.

This article is brought to you courtesy of Zacks.

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