While emerging markets have been hit hard recently, with foreign investors dumping EM stocks and bonds for five consecutive months, India is telling a different story. Not only has the country recently overtaken the U.K. as the world’s fifth-biggest economy, but India is also one of the world’s fastest-growing major economies.
India has a lot of things going for it now. Its GDP is set to be above China’s. Its stock market has performed better through the pandemic than many of its peers. Even its local currency government bonds enjoyed a mini rally in August.
Glen Finegan, lead portfolio manager at Skerryvore Asset Management, told the Financial Times that India’s economy is entering a new phase, driven by a transition from highly regulated to a more liberalized business environment and a young population that will soon provide the country with a labor force larger than China’s.
“It feels like the economy has gone past a tipping point, to where growth is to some extent self-sustaining,” said Finegan. “There are a lot of tailwinds.”
Kevin T. Carter, founder and CIO of EMQQ Global said: “India is a significant part of our strategies. That is expected to grow in our upcoming rebalance and for the foreseeable future.”
Carter added that India is also “one of the most exciting pockets in the global equity landscape when you consider the size of the market, the growth in the economy, and the very low penetrations rates. Its tech ecosystem today is where China was ten years ago and where the U.S. was two decades before.”
India is the second-largest exposure in EMQQ Global’s Next Frontier Internet & Ecommerce ETF (FMQQ) and the entire focus of the India Internet and Ecommerce ETF (NYSE Arca: INQQ).
FMQQ is designed to provide investors with exposure to the internet and e-commerce sectors of the developing world. FMQQ seeks to provide investment results that, before fees and expenses, generally correspond to the price and yield performance of the Next Frontier Internet and Ecommerce Index.
Meanwhile, INQQ intends to capitalize on India’s rapidly growing digital and e-commerce sectors. INQQ seeks to provide investment results that, before fees and expenses, generally correspond to the price and yield performance of the India Internet and Ecommerce Index.
“For retail investors looking for a gateway to India, there are a few routes available. Anybody looking for short-term profits may be gambling with the Fed and the global outlook. But for those prepared to wait out any immediate market instability, India offers a bit of economic hope at a time when there is not much around,” according to the FT.
Both funds have an expense ratio of 0.86%.
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