India equities ETFs are seeing a significant uptick in interest in VettaFi’s ETF Database as investors look abroad for opportunities. So what’s driving that attention? Geopolitics has a role to play in drawing attention, of course. However, recent positive economic reports may be the real cause for pushing India equities ETFs to the forefront of investors’ minds.
The country’s Finance Ministry announced earlier this month in an annual economic report that the nation appears “poised to sustain its growth” more durably than before. That news likely cheered investors who may have been burned by previous excitement about India. What’s more, Goldman Sachs dropped a new projection just this week that India’s economy will surpass the U.S. economy by 2075.
These arrived just as the Indian stock market hit record highs late last month, as well. The nation’s benchmark Sensex index which includes 30 large firms, rose a potent 10% over the three months ending in late June. The Sensex index has risen 9.1% over the last six months as of July 13th, meanwhile.
Those news drops also followed a landmark visit to the United States by Indian Prime Minister Narendra Modi last month. Modi’s visit offered the opportunity for U.S. President Joe Biden to discuss deepening defense ties with India. The meeting also underscored the nations’ tech partnerships, good news for U.S. investors eyeing a burgeoning Indian tech industry.
The U.S. isn’t the only nation deepening ties to India, either, with Taiwan expanding its own economic presence there. These deepening ties aren’t solely attributable to economics, either, but also to India’s rivalry with China. Taken together, these trends may be directing investors to look at how India equities ETFs can play a role in portfolios.
Investors may want to take a look at the WisdomTree India Earnings Fund (EPI) as one option to consider. EPI tracks the WisdomTree India Earnings Index for an 84 basis point (bps) fee. The strategy weights its holdings by earnings rather than market capitalization. EPI has returned 9.5% YTD, outperforming its Factset Segment and ETF Database Category Averages. The ETF is nearing $1 billion in AUM at $962 million, and may be worth a watch for those eager for Indian equities.
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